I don't think this can be classified any other way than a scam. Sure, they scam you out of a couple of dollars, but they do it on a massive scale and at the expense of thousands upon thousands of people.
First off, the bonus. For my purposes, I will call it "free", but as one response was so happy to point out, nothing is truly free, but I won't debate whether something should be provided at-cost or not here. However you feel, $2.5 is the price for one ride, and anything below that from the perspective of the buyer is essentially gratis. Assuming the bonuses were not there, for all three default payment paths, you would have $1.5 remaining. And hey, the lowest amount you can refill with happens to be a dollar! $1.5 + $1 = $2.5 = one perfectly balanced card.
Now for the price change. Cards were free, so essentially you really were paying for a balanced amount that would leave you with no remainder. Again, ignoring the bonus, you were essentially putting $10, $20, and $40 on your card - all values perfectly divisible by $2.50. Now cards cost a dollar. That's a different debate, but that explains the $1.5 pre-bonus dangler.
He goes on to mention, "If they really wanted to fix the issue, they could ask “How much do you want on your MetroCard” instead of “How much do you want to pay”. But don’t count on those changes coming to a MetroCard Vending Machine near you anytime soon, given how lucrative the current set up is."
But prior to the one dollar surcharge, that is essentially what it was doing. It's been updated to reflect the dollar surcharge, and it has always elected not to show the final amount + bonus. Including the bonus would be just confusing, especially if you were trying to pay with cash/coins. "Oh hey, I want $10 to be on my card, including the bonus." "Okay, please enter $9.524" Yes, that's right, it's not an even $9.5. 10 / 1.05 = 9.5238~
If there's any "answer" here, it's that they wanted the cheapest/smallest amount of software updates that they could get away with using their original software/ui.
I think it's fair to call that a dark pattern, especially for a public service, it is simply a hidden tax for tourists.
Thats the ground state of this system as they have designed it.
As I mentioned, excluding the bonus, and prior to the dollar surchage, that wasn't really true. The values were perfectly divisible by $2.5.
But if you look at the author's own images, the "Other Amounts" button is pretty prominent. Short of a brand new auto-rebalancer option, what would you suggest? If my claim is true, and that they wanted to have the cheapest transition / software update they could manage, that option would violate that. They essentially changed a table of numbers (I assume) and most of their old UI was reusable.
The next cheapest option that would satisfy your requirement is to blow out all 3 quick options (and eliminate the bonus) and have only an "Other Amounts" path, essentially forcing manual re-balance.
Here's a much better way of "outsmarting" it: buy an MTA EasyPay Xpress card[1]. The card will be linked to your credit card, so you will never have to worry with insufficient fare again.
Plus you still get 5% every $5, with the convenience of auto-refill, and full protection if you ever misplace your card.
Way better than spending time counting pennies.
That was at the underground Victoria station ticket counter.
That's only for registered cards. Which makes perfect sense, because they're registered to an address to prevent people stealing them and returning them for cash
You don't have to register your card. If it is unregistered and someone steals it there is nothing you can do to recover any money on the card.
You can choose to register it, in which case you can transfer the balance to a new card in the case it is lost or stolen.
Bitcoin is already this way. All "cash" is associated with an address. To use that cash you need to be the owner of that address.
note: lose as in someone steals it.If it's totally lost the money is gone, as we know.
The rare user might prefer to buy Exactly One (or two or four) tickets, as they know they won't use the excess. This is similar to the frustration of a first-time user at the bay area ferries, where the process of registration, app installation, etc, is much less convenient than most parking.
The regular user, however, doesn't care as much about the initial overhead, as the convenience outweighs the overhead. A remainder balance on the card is less frustrating than for a tourist, as they know they're going to fill it up again.
That said, it would have been nicer if the transit company had phrased pricing in terms of Number Of Rides, rather than dollars (dollar amounts made up):
4 rides ($10.42)
10 rides ($21.37)
50 rides ($90)
100 rides ($180)So I assumed I'd need a "tourist" Oyster as I wasn't a resident. But when I looked in to it as a tourist you had to book well in advance so they can post a card to you - whilst if you ignore the "tourist" offering you can just pick up the card at your arrival station (Victoria for me, very easy, was from a machine IIRC). Also the charges seemed higher for tourists somehow and there seemed to be difficulties giving the card back and getting a refund - I could see no reason to have a tourist Oyster.
One of the kids travelled free, with me, as it happened which was great. The only problem is that the automated turnstiles wouldn't let us through separately without us paying twice (for which we'd need a different Oyster) and I got "munched" on a couple of occasions one of which gave me a very sore back, it was quite vicious.
Traveller beware!
Octopus cards never expire, as far as I can tell.
The US is, not surprisingly, way behind here.
Because of the unreliability of MetroCards and MetroCard readers, the MTA is planning to phase them out in a few years and replace their card readers with equipment that can directly read contactless (RFID) credit cards.
Also, in conjunction with the good counter-points being made by others here, let's not forget his points rest upon free money. Without that bonus, he'd be a dollar short, not 5 cents. In fact, with option 3 (the $39 one), he literally received an extra subsidized ride. $39/2.5 is 15.6 => 15 rides. But with the free bonus he is able to take his 16th ride.
I suspect this has more to do with poor UI, than anything else. Take a look at the Citibike UI if you're not an annual member. You will have less hair after having used it. Makes the MTA one seem glorious.
Hah! That's a good one!
It's like those stores that always have half the store "50% off," they just always charge more and expect you to only buy the things on sale and feel like you got a great deal when in reality you paid what they expected you to pay.
i.e. that "free 5%" you get when buying a card comes is the same damn thing as just charging 5% less on the per ride costs in the first place. It's not free money at all. You just feel like it's free. Honestly, that "free money" only further supports the idea that the MTA is run more like a penny-pinching crony business than a public transport system.
There's a measurable difference between the bonus and no-bonus option, and in this case, that's 5%. That is the offer. Given the option between the two, I'll take the bonus knowing fully well in either scenario they are profiting.
AT&T's classic monthly rates factor in subsidization, and thus are substantially higher than ...whatever value you seem to be wishing that they charge - I sincerely hope not at-cost. If they offer a 5% discount, they're still profiting, but you're paying 5% less than you would have. That is something, and that is an offer.
You're comparing apples and oranges. Compare the 5% bonus with simply lowering the cost of fares an equivalent amount.
The MTA is at least partly-funded by real-estate taxes.
Of course, now that there's the $1 per card fee, it might not be a useful purpose, but that's a different argument.
I think there's a strong likelihood that the numbers 9, 19, and 39 were chosen because with the $1 card fee, they make nice round multiples of $10. Put a $20 bill in, get a $19 card.
They have a history of not making enough money, and everyone in NYC gets in a rage whenever the fare has to be hiked up. So if they're able to make some extra money off of tourists, for the benefit of all the regular New Yorkers, that's fine by me.
Except, you know, when they discovered that they had an extra $1.9B dollars (surprise!)
http://jalopnik.com/nycs-mta-finds-unexpected-1-9-billion-st...
This has happened in the past too, where they magically discovered a surplus. I'd have to dig for the reference.
They are terrible at bookkeeping is one reason New Yorkers hate the MTA.
If you want to charge me $1000, then put the price at $1030 or whatever your fees come out to. Anything else is disingenuous.
People want lower prices, so one way companies can lower the price is to pass the credit card fee on to the consumer, while also giving them the option of using a different payment method with a lower fee.
Personally I would always pay with cash/e-check if there was a financial incentive to do so. Offering the same price for both is just silly since the cash customers are basically subsidizing the credit card customers.
A better way to do this is by offering a "cash discount", so the stated price is never added to, only subtracted.
And I'm not sure your point on "a very American attitude". I live in America, so... yes? When I tell someone my address, they don't look down their nose and say "that's a very American address". Of course it's American. That's where I live. Contrary to some opinions, American things aren't always automatically wrong just because they're American. I'm sure if I lived in Belgium I would pay tax and VAT and credit card processing fees and think nothing of it. But I don't live in Belgium. I'd have the same reaction if my landlord asked me to pay rent in Yen just because there was a favorable exchange rate for him.
And you're right- a better way to do it is to have the lowest fee added to the cost.
The issue in credit cards is that merchants are in fact required to hide the cost: they are not allowed to charge extra for credit card transactions. Likewise, they are not allowed to give a discount for cash transactions. ("Hidden charges are bad: so banks like them!")
The apartment building may in fact be breaking the merchant agreement by applying this charge. This is a good thing; vendors should fight against that hiding.
See, if rent is $1400 and you can pay exactly $1400 by any method: credit card, check or cash, then you're being ripped off if you don't use a credit card! They are pocketing the merchant fee that they would have had to pay on the credit transaction. Why would you care, it's $1400 to you either way, right? Wrong: if you use credit, you "earn" points. If you have a credit card that earns 2% of purchase prices in points, you get 28 points, and if these points can be be converted 1:1 for dollars in some way (like buying an airline ticket), that's 28 bucks! So it's like you're really paying $1372 for your rent, and getting a $28 kickback. The building coughs up a merchant fee, and some of that is kicked back to you in the form of points. Doesn't that person paying by check look like a complete sucker now, if the amount is the same for all methods of payment?
The card user is effectively getting a discounted rent, and supporting the leeching credit card company too, which gets a cut of the discount. Why should the building support that? If rent is $1400, it is not fair that someone pays only $1372, after getting a $28 kickback in points, which comes out of a $50 fee that the building has to pay. The building is robbed of operating income, which means that the rents are higher than what they should be.
Now vendors of goods like credit cards and pay the fees, and comply with the rules of hiding the fees, and not offering cash discounts. Why? Because credit cards encourage rampant consumerism. They bring in business.
The apartment building doesn't need this argument: you owe rent and that's it.
Interestingly, the IRS in the US evidently allows taxes to be paid by credit card. But there is a charge:
http://www.irs.gov/uac/Three-Ways-to-Pay-Your-Federal-Income...
The same arguments apply: without a charge, you'd be getting a tax break, analogous to the rent break. The government is not a store; it does not need to attract "customers" to pay taxes.
As of early last year, credit card surcharges are also now permitted by Visa/Mastercard: http://www.cardfellow.com/blog/checkout-fees-charging-credit...
If the agreement does not specify the form of payment, any form will be considered acceptable. If rent can be paid in person, the agreement must include the days and hours payment will be accepted. If rent can be paid only by mail, then it is presumed paid on the date it is mailed, if the tenant can show proof of mailing. If rent can be deposited at a financial institution, the owner must disclose the account number and name and address of the institution, which must be within five miles of the tenant's residence.
It's absolutely absurd. If I paid by credit card, by the end of the year I would have essentially paid an entire month's rent in fees.
This assumes you're in the US though, and you would have do get a kick out of yanking their chain, willing to play the game, etc, but it could be fun/funny.
Additional fees (including the common "plus tax" at the store) are a scam and should be abolished. If that were the case, the MTA issue in the article wouldn't matter.
It should be made apparent how they accept money and what the associated fees are before you sign your lease. That's the only malice I see.