Skipping an Appointment? It Could Cost You.
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Access to affordable credit helps me pay my employees, but I don't really need it. Inflation is killing me. But who cares? Big retailers are making record profits. That's why we support the Durbin Marshall credit card bill. See? Banks and credit unions help small businesses make payroll. This bill would cut the vital resources they need. While increasing megastore profits. They deserve it, don't they? Tell Congress, stop the Durbin Marshall money grab for corporate megastores. Paid for by the Electronic Payments Coalition.
Here's your Money Briefing for Monday, May 6th. I'm J.R. Whelan for The Wall Street Journal. If you've ever ghosted your friends, you probably got an earful, maybe some dirty looks. But being a no-show for a service appointment, that could cost you actual money.
These fees are a new solution to an old problem. If you could think back to a few decades ago, if a barber had a client not show up, it would have taken a lot of effort on his part to track that person down. And then it would be an awkward confrontation to recoup whatever he perceives as the value of his time. But now it's as easy as hitting a button.
Our personal finance reporter Amani Moise will be here to talk about late and no-show fees and how you can wiggle out of them after the break.
Access to affordable credit helps me pay my employees, but I don't really need it. Inflation is killing me. But who cares? Big retailers are making record profits. That's why we support the Durbin Marshall credit card bill. See? Banks and credit unions help small businesses make payroll. This bill would cut the vital resources they need. While increasing megastore profits. They deserve it, don't they? Tell Congress, stop the Durbin Marshall money grab for corporate megastores. Paid for by the Electronic Payments Coalition.
What types of businesses are now charging no-show and late fees?
More businesses are charging customers fees for arriving late or not showing up at all. Wall Street Journal personal finance reporter Amani Moise joins me. Amani, what types of businesses are charging these fees?
Really any type of consumer service. So whether that be a hair salon, a nail tech, cleaning service, tutor, it's any one-to-one relationship or anyone that's providing you a service could potentially charge you a fee these days.
When do these fees become so widespread?
They really started to become more popular after COVID. That's when we saw a lot of small businesses go digital or transfer to digital payment systems by necessity. And when they realized how easy it was to charge people a cancellation fee using these new systems, they figured they might as well keep it in place.
How much can these fees come out to?
It depends on the service. One of the standards is just if it's a true no-call, no-show, sometimes these business owners can charge you the price of whatever service that you are booking, 100%. Sometimes it's 50%. One of these platforms, Square, they say they allow people to charge up to $500 in cancellation fees.
Oh, wow. That's a big fee.
But they do say that's rare. The average cancellation fee is closer to $50.
Why do businesses feel they need to charge people a fee?
These fees are a new solution to an old problem. If you could think back to a few decades ago, if a barber had a client not show up, it would have taken a lot of effort on his part to track that person down. And then it would be an awkward confrontation to recoup whatever he perceives as the value of his time. But now it's as easy as hitting a button. Because so much of that friction has been taken away with the fees, that's why we're seeing them become more popular.
Do merchants have to spell out the potential for a late or no-show fee to consumers up front?
It's still a little bit of the wild, wild west right now. Sometimes they'll say that there is a fee. They won't disclose how much the fee is. I do think when it comes to potential disputes, the businesses have more of a leg to stand on when their policies are stated clearly up front than as a surprise gotcha fee. But unfortunately, there's not a lot of standardization when it comes to cancellation policies.
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