Ryanair Vs OFT: War of words

Ryanair: Angering OFT

Whilst many have slammed budget airline Ryanair for numerous reasons, the Office of Fair Trading (OFT) have described the airline as "puerile and childish" over its payment policy off adding fees when customers use all but one type of credit card to pay online.

Speaking to the Independent newspaper, OFT chief executive John Fingleton attacked Ryanair saying that the airline was using a loophole in order to justify the additional fee. The law states that if an airline offers at least one free payment method, it is allowed to advertise cheap fares that do not include extra credit card charges.

However, Ryanair have chosen a rare payment method to get around the rules - the free booking service is only available to customers who pay for tickets with a Mastercard prepaid card.

Ryanair said their payment policy model allowed passengers "to avoid costs" and that compulsory fees and charges are included in all the airline's advertised prices. The company also argues that payment handling fees are discretionary.

Despite this claim, banks currently charge airlines between 1.5 percent to 2.5 percent of a payment in transaction fees. This equates to less than £1 to process a debit card transaction. For a family of four, paying on one debit card should cost about 30p if they were just covering the airline's costs, however Ryanair's fees means they would be charged £40 by Ryanair.

"Puerile and childish"

In his interview with the Independent newspaper, Mr Fingleton said, "Ryanair has this funny game where they have found some very low frequency payment mechanism and say: 'Well because you can pay with that'.

"It's almost like taunting consumers and pointing out: 'Oh well, we know this is completely outside the spirit of the law, but we think it's within the narrow letter of the law'."

"On some level it's quite puerile - it's almost childish."

Fingleton also queried the use of automatic addition of insurance to flights by airlines such as Ryanair, unless customers opted out, but Ryanair stated that insurance options were, again, included in an opt-in not opt-out basis.

In response to Fingleton's comments, Ryanair Head of Communications Stephen McNamara countered by saying, "Ryanair is not for the overpaid John Fingletons of this world but for the everyday Joe Bloggs who opt for Ryanair's guaranteed lowest fares because we give them the opportunity to fly across 26 European countries for free, £5 and £10.

"What the OFT must realise is that passengers prefer Ryanair's model as it allows them to avoid costs, such as baggage charges, which are still included in the high fares of high cost, fuel surcharging, strike-threatened airlines such as BA."

Whether this controversy will hamper Ryanair's popularity remains to be seen.

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