Yesterday, a memo was leaked via DroidLife detailing Verizon’s plans to implement a $2 “convenience fee” for customers who made payments by phone or online. The charge itself was intended to be an incentive for customers to switch to Verizon’s own AutoPay system, which automatically deducts from a linked checking or savings account or credit card. In addition to giving Verizon more control over payments, it would also allow them to avoid credit card fees. Soon after the leak, a press release was issues confirming Verizon’s new $2 surcharge and listing a few payment options that would allow customers to avoid the fee.
Show Press Release
Verizon Wireless offers customers numerous free and simple payment options and we encourage customers to use those options. Starting January 15, a new $2 payment convenience fee will be instituted for customers who make single bill payments online or by telephone. There are a couple of exceptions. See below. The fee will help allow us to continue to support these single bill payment options in these channels and is designed to address costs incurred by us for only those customers who choose to make single bill payments in alternate payment channels (online, mobile, telephone). It is waived for those who pay by electronic check or enroll in AutoPay — we encourage customers to use those or other payment options that incur no fees. [See complete list below.] The telephone and online single payment fee, which takes effect January 15, will be disclosed up-front and throughout the transaction.
There are numerous payment options available to our customers where the fee is waived or where no fee applies. They include:
1. Electronic check online (My Verizon Online, My Verizon Mobile/Handset). Fee waived.
2. Electronic check via telephone. Fee waived.
3. Enrollment in AutoPay using credit/debit/ATM card or electronic check; fee does not apply
4. Online from the customer’s home-banking service provider website; fee does not apply.
5. Credit/debit/ATM card, electronic check or cash at a Bill Payment Kiosk, Panel or with a representative at a Verizon Wireless Communications Store; fee does not apply.
6. Use of a Verizon Wireless Gift Card or Verizon Wireless device Rebate Card to pay a bill in-store, online or by telephone; fee does not apply.
7. Paper check or money order mailed to the VZW remit address on customer’s bill; fee does not apply.
Although the nature of the new charge wasn’t unique–Sprint has been quietly tacking a $4.99 charge onto non-automatic payments for a while now–the plan still drew customers’ ire and resulted in considerable backlash.
Image credit goes to www.droid-life.com
Surprisingly, Verizon almost immediately issued an official press release confirming that they’d backed off and decided not to implement the charge. Verizon CEO Dan Mead stated, “Based on [customers’] input, we believe the best path forward is to encourage customers to take advantage of the best and most efficient options, eliminating the need to institute the fee at this time.” Good to know that keeping customers happy is still a priority over at Big Red–even if the recent network outages might indicate otherwise.
Show Press Release
Verizon Wireless has decided it will not institute the fee for online or telephone single payments that was announced earlier this week.
The company made the decision in response to customer feedback about the plan, which was designed to improve the efficiency of those transactions. The company continues to encourage customers to take advantage of the numerous simple and convenient payment methods it provides.
“At Verizon, we take great care to listen to our customers. Based on their input, we believe the best path forward is to encourage customers to take advantage of the best and most efficient options, eliminating the need to institute the fee at this time,” said Dan Mead, president and chief executive officer of Verizon Wireless.
I really am at a loss to understand Verizon’s decision. The announcement of a $2 “convenience fee” (http://blog.unibulmerchantservices.com/everything-you-need-to-know-about-credit-card-convenience-fees) and its renouncement on the following day must be one of the dumbest business moves of 2011 in a very strong field. What were the Verizon guys thinking? This $2 fee looks to a customer exactly the way BofA’s $5 debit card fee did a couple of months ago when it caused a huge backlash, prompting the bank to quickly scrap it (but not before the damage to its reputation, such as it was, was already done). I would’ve expected no one to try anything remotely resembling such a fee for at least a couple of years. As I said, I’m at a loss.