Fee to deposit cash into my online broking account

[johnnygetyourmum]

Hi there.

I'm just getting started and tonight I set up an online trading account with CMC.

Their fees on trades seem reasonable but then when I looked at the "How do I fund my account" section, looks like I got to pay 0.6% of the deposit amount to deposit cash into my CMC account.
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You can fund your account using a credit or debit card or by transferring funds from your bank account. There is a 1% charge for credit card payments and 0.6% charge for debit cards.
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Is this to be expected from all online brokers?

I just want to do the odd trade. Having access on my phone would be handy. Am I better off just going with ComSec?

Thanks.
John

 

[Value Collector]

Hi there.

I'm just getting started and tonight I set up an online trading account with CMC.

Their fees on trades seem reasonable but then when I looked at the "How do I fund my account" section, looks like I got to pay 0.6% of the deposit amount to deposit cash into my CMC account.
------------------------------------------------------------
You can fund your account using a credit or debit card or by transferring funds from your bank account. There is a 1% charge for credit card payments and 0.6% charge for debit cards.
------------------------------------------------------------

Is this to be expected from all online brokers?

I just want to do the odd trade. Having access on my phone would be handy. Am I better off just going with ComSec?

Thanks.
John

Looks like they are just passing on the credit card fee they will be charged.

When you buy things using credit cards, the merchants have to pay a fee.

Eg, you purchase something worth $100, and your card is debited $100, but the merchant only gets $99.40 put into their account.

Retailers don’t usually mind because they have large profit margins, the thing they sold you for $100 probably only cost them $70, so they don’t care about only getting $99.40 after the 0.6% fee.

However, CMC aren’t making any profit on the transaction of you depositing funds, so will want to pass the 0.6% fee onto you .

Simple solution is just avoid using a credit card.

 

[HelloU]

"Is this to be expected from all online brokers?"

not in my experience for transfers of this type - but only 1 of my brokers will do this i think?

 

[myrtie100]

Hi John, I'm quite sure they would offer other ways of funding your account. Look for info on direct bank transfers or bpay.

 

[noirua]

In the EU it is illegal to make any surcharge when payments are made by Credit Card or Debit Card.
https://europa.eu/youreurope/citizens/consumers/shopping/pricing-payments/index_en.htm

In the United States it is illegal to make any surcharge if payments are made by Debit Card. It is legal to add a surcharge for Credit Cards in America after a recent lawsuit but few companies have adopted surcharges.
https://www.thebalance.com/credit-card-surcharges-315423

Australia is one of the few countries in the world still allowing surcharges on debit cards. However, it does seem unreasonable for CMC to make a 0.6% charge on debit cards: They may be acting illegally as 0.5% is the considered maximum and they must not charge more than it costs them.
https://www.abc.net.au/news/2017-08...ve-surcharges-banned-across-australia/8859100
https://www.news.com.au/finance/mon...a/news-story/d88cafbf97096fcc56f63951e388057f