BajaNomad

Credit crunch for real: Volaris declining ALL US credit card purchases

danaeb - 10-5-2008 at 09:14 AM

I had an unsettling experience this weekend when I attempted to purchase a ticket online from Volaris for travel from TIJ-LAP this Christmas. After entering my credit card info and submitting the data to purchase the flight, an error message was displayed to the effect that the transaction was not accepted.

I called my credit card company first. There was no problem with the card and in fact, the Volaris transaction had never reached them. I then called Volaris and was told by their customer service rep that the "system is declining ALL US credit cards." When I asked what my options were, he suggested I go to the airport and purchase the ticket with cash. Let that sink in for a minute.

Anyone else think this is scary???

David K - 10-5-2008 at 09:22 AM

I think it is an issue with Volaris, and not your U.S. credit card... So, not scary IMO...

danaeb - 10-5-2008 at 09:25 AM

You missed my point David. I know it's not a problem with MY card. They are not accepting ANY US credit cards.

oldlady - 10-5-2008 at 09:27 AM

I can think of a couple of reasons why David K may be correct, particularly if
your credit card is being accepted by US Merchants.

Agree

Dave - 10-5-2008 at 09:35 AM

Quote:
Originally posted by David K
I think it is an issue with Volaris, and not your U.S. credit card.


The scary part is Volaris apparently needs hard cash. Don't know that I'd want to fly an airline in that financial condition.

bajalou - 10-5-2008 at 09:40 AM

danaeb states "US credit cards" - which implies that they accept them from other countries. Not everyone in the world thinks the US credit problems are over.

vandenberg - 10-5-2008 at 09:44 AM

Maybe they're running on such a tight margin, that even the 3 %(?) credit card processing fee is too much to give away for their budget.:?:

danaeb - 10-5-2008 at 09:44 AM

Thanks Lou. That was the point. Volaris is a healthy airline (Carlos Slim's baby). If I had been told that they weren't accepting ANY credit card payments I would agree with David and oldlady, but the CSR told me explicitly that it was US credit cards.

BajaGringo - 10-5-2008 at 09:49 AM

Personally I wish that all businesses would stop taking credit cards for 90 days, only accepting cash and debit cards. That might get folks thinking about what it is like to just live off what you have and get off the credit fix so many are addicted to today.

Maybe Volaris is doing us a favor...

Probably more to do with the float.

Dave - 10-5-2008 at 10:23 AM

Quote:
Originally posted by vandenberg
Maybe they're running on such a tight margin, that even the 3 %(?) credit card processing fee is too much to give away for their budget.:?:


Time and expense to clear accounts.

Cajones - 10-5-2008 at 10:47 AM

Quote:
Originally posted by BajaGringo
Personally I wish that all businesses would stop taking credit cards for 90 days, only accepting cash and debit cards. That might get folks thinking about what it is like to just live off what you have and get off the credit fix so many are addicted to today.

Maybe Volaris is doing us a favor...


That makes absolutely no sense. I have no debt and use credit cards because I don't like to carry a lot of cash. Why do I have to think about living off what I have? That's what I already do. And what about those businesses? You are asking them to restrict their sales to cash? How does that help their bottom line? If a credit card customer does not pay his credit card, the credit card company loses the money, not the business.

danaeb - 10-5-2008 at 10:47 AM

So - I just tried again. Called Volaris to extract a little more information. They are NOT accepting (and these are his exact words) "any AMERICAN Visa or Mastercard accounts". They are accepting US American Express cards.

BajaGringo - 10-5-2008 at 11:05 AM

Quote:
Originally posted by Cajones
Quote:
Originally posted by BajaGringo
Personally I wish that all businesses would stop taking credit cards for 90 days, only accepting cash and debit cards. That might get folks thinking about what it is like to just live off what you have and get off the credit fix so many are addicted to today.

Maybe Volaris is doing us a favor...


That makes absolutely no sense. I have no debt and use credit cards because I don't like to carry a lot of cash. Why do I have to think about living off what I have? That's what I already do. And what about those businesses? You are asking them to restrict their sales to cash? How does that help their bottom line? If a credit card customer does not pay his credit card, the credit card company loses the money, not the business.


Read the entire post - I said cash and debit cards. Debit card transactions link directly to checking accounts - actual cash in your account. Obviously I made the post tongue in cheek only trying to address the bigger issue that too many folks today are living off credit.

Then the question should be...

Dave - 10-5-2008 at 11:08 AM

Quote:
Originally posted by danaeb
They are NOT accepting (and these are his exact words) "any AMERICAN Visa or Mastercard accounts". They are accepting US American Express cards.


How long to clear MC/VISA vs AMEX?

bajajudy - 10-5-2008 at 11:09 AM

Well since most Visa and Mastercards are issued by banks maybe they are worried about the banks folding.
Amex issues its own cards.

danaeb - 10-5-2008 at 11:13 AM

OK - just completed the transaction using AmEx. Judy - I think you're right. There's a fear that many US banks may not be solvent. Who know what load of crap they may be sitting on. Now we know why Slim got so rich?

[Edited on 10-5-2008 by danaeb]

bajalou - 10-5-2008 at 11:21 AM

I think much of the world view the financial problems in the US much more seriously than the average American who thinks "This really can't effect me."

BajaGringo - 10-5-2008 at 11:24 AM

Quote:
Originally posted by bajalou
I think much of the world view the financial problems in the US much more seriously than the average American who thinks "This really can't effect me."


BINGO!!!

We have a winner...

oxxo - 10-5-2008 at 11:52 AM

Quote:
Originally posted by bajalou
I think much of the world view the financial problems in the US much more seriously than the average American who thinks "This really can't effect me."


I agree. I think it is entirely possible that some American businesses my stop accepting Visa/Mastercard for purchases in the near future. This could hit home sooner than we might think. My family is making contingency plans, just in case.

vacaenbaja - 10-5-2008 at 12:44 PM

Perhaps it is a matter of cash flow. In times like thse cash is king. Even in less volital times financial institutions play little games all centered around keeping cash as long as possible. They play the float.
Time is money when holding cash. And when millions/billions are involved thats alot of cash that can be made if you could just hold it long enough. Checks and credit are not cash.
One suspends payment and the other is sort of a calculated gamble that the person will pay. The risk factor is built into the interest rate. Kicking the can ahead so to speak.

bajajudy - 10-5-2008 at 01:11 PM

It also may have absolutely nothing to do with the credit problems in USA. Visa and Mastercard are both serviced by the same processing companies and Volaris may be having problems with them.
Amex does all its own processing and charges the merchants more too.

bajalou - 10-5-2008 at 02:27 PM

Remember, it is only US Visa and Mastercards that Volaris isn't accepting.

Don Alley - 10-5-2008 at 03:22 PM

Anyone read financial news from Europe lately? Germany to guarantee bank deposits, and a plan to bail out a large real estate lender to the tune of 35 billion Euros (nearly $50 billion US) has failed. Belgium is trying to find a buyer for insurance giant Fortis.

From Voice of America:

"Governments across Europe are scrambling to save failing banks Sunday, a day after European leaders called for a more coordinated response to the global financial crisis."

This is not simply a US problem. I suspect Volaris' refusal to take US credit cards is a Volaris problem.

bajajudy - 10-5-2008 at 03:40 PM

You are correct Lou.
We do not take credit cards here so I dont know exactly how they work here. But it could be that their bank card service company is not taking the US cards and that would indicate an even deeper problem.
Don...I agree with you. I dont think that John nor Jane sixpac have any idea how bad things might get.
The Asian markets were holding their own. We will see what this week brings.
I will check at Interjet in Mega to see if they are taking US cards.

bacquito - 10-5-2008 at 03:48 PM

Ive also heard that credit card limits will be revised downward and some credit cards cancelled. The use of a credit card really reduces the need to carry alot of cash. These are rough times.

flyfishinPam - 10-5-2008 at 04:30 PM

My merchant visa/mc deposits are taking longer than usual to get to our account as of 2 weeks ago. Our bank is BBVA.

Baja-Brit - 10-6-2008 at 12:49 AM

We have a saying in the UK "When the US sneezes we catch a cold".

All eyes are on America.

The current "credit crunch" started there with the sub prime fiasco and what happens next has massive ramifications throughout the world.

The banks and other financial institutions have not only been irresponsible but also less than honest.

This has led to distrust between banks/credit card companies and other banks/credit card companies and are now unwilling to lend to each other

.........and now as it seems between credit card companies and retailers!

There is worse to come so tighten your belts chaps.


As you were.



[Edited on 6-10-2008 by Baja-Brit]

Baja-Brit - 10-6-2008 at 07:18 AM

Quote:
Originally posted by Don Alley
Anyone read financial news from Europe lately?



Credit crisis: European responses

http://news.bbc.co.uk/1/hi/business/7654647.stm


As you were

flyfishinPam - 10-6-2008 at 07:45 AM

another thing on credit cards that I was just made aware of last may 2008:

when running a card that gets declined, the amount of the attempted charge gets held by the bank for three business days. this is to say if its a debit card that money gets taken out of your account and held. its bogus I know but its happening, so be aware of this.

i was told about this on two occasions during the summer and then in august it happened to me personally. i tried to purchase an item with my debit card and the card was declined for no reason other than the person's terminal wouldn't (or couldn't) authorize the charge. the money was held for three working days before being returned to my account (Bank of America). i purchased the item no problem with another company on the same card.

at this point our US dollar credit card deposits into our merchant account in Mexico are being held for three to five days where as before a couple of weeks ago they were deposited the next business day. peso charges to american or foreign credit cards always took more time likely due to exchange rate issues but this is us dollar processing I'm refer to. our Mexican bank associated with our merchant accounts is Bancomer, BBVA.

stanburn - 10-6-2008 at 12:59 PM

Being a full-time Mexican resident, I don't find it that unusual that a Mexican company doesn't accept a US credit card. I have had trouble a couple of times using my US credit card in Mexico and my satellite TV provider, Sky which is a Mexican company, does not have the ability to charge the monthly payments to a non-mexican credit card.

It leads me to believe there are different levels of credit card service that Mexican businesses sign up for. Maybe Volaris has a lower level?

Crusoe - 10-6-2008 at 02:03 PM

Credit situations are changing very fast now. All of Mexico will feel the U.S. sneezing and faultering. News sources such as A.O.L. and 24/7 Wall Street, are reporting American Express's shares dropping 50% more than any others and cash strapped companys like theirs, such as Safeway,Circut City, Tiffany & Co. and Apple are all on shaky unstable ground. ++C++

danaeb - 10-6-2008 at 02:34 PM

The difference in the Volaris situation is this: up until two weeks ago they accepted US credit cards. I have used mine to purchase their tickets on multiple occasions without problems. It's lack of confidence in US banks that is causing the problem. Mexican bank-issued cards are acceptable as are AmEx (at least through yesterday).

bajajudy - 10-6-2008 at 04:36 PM

Quote:
Originally posted by stanburn
Being a full-time Mexican resident, I don't find it that unusual that a Mexican company doesn't accept a US credit card. I have had trouble a couple of times using my US credit card in Mexico and my satellite TV provider, Sky which is a Mexican company, does not have the ability to charge the monthly payments to a non-mexican credit card.

It leads me to believe there are different levels of credit card service that Mexican businesses sign up for. Maybe Volaris has a lower level?


We pay for Sky with our Amex US credit card.

Tiomiguel - 10-6-2008 at 04:49 PM

I agree with Cruso, the word from Kramer on CNBC is that the one to watch out for is American Express as they are not a deposit taking institution so all of their float etc. comes from corporate borrowing, ie. the other part of the problem out there, liquidity. Seems silly to accept it and not visa, somebody is making a bad decision that will have a big effect on their business.

Stickers - 10-7-2008 at 07:40 PM

Quote:
Originally posted by oxxo
Quote:
Originally posted by bajalou
I think much of the world view the financial problems in the US much more seriously than the average American who thinks "This really can't effect me."


I agree. I think it is entirely possible that some American businesses my stop accepting Visa/Mastercard for purchases in the near future. This could hit home sooner than we might think. My family is making contingency plans, just in case.


Of all the companies plagued by financial problems I certainly never thought it was credit card companies. They have license to steal and seem to make a billion dollars a day financially enslaving American consumers.



.

woody with a view - 10-7-2008 at 07:48 PM

Kramer is a Kommie.