Allegiant is second only to Spirit Air in the United States in their focus on ancillary fees as a source of revenue. Both now charge for carry-on bags and most other things you can think of as part of the purchase process. While Spirit has a "usage fee" for booking on its website Allegiant is choosing a different tack, adding a fee to use credit cards as a payment method.
Technically this is a discount for using a debit card, a transaction type which is cheaper for them to process, and not a fee. Because of that it isn’t details on their fee schedule. But it is very much a requirement for customers who want to pay with a credit card, running $4-6 per passenger per segment. With 1.7mm passengers quarterly that adds up in a hurry to a lot of revenue.
The carrier, of course, maintains that customers are getting the lowest base fares possible and then choosing the "extra" benefits they need. In the case of buying with a debit versus credit card, however, there are some very real reasons customers should be cautious about using a debit card to save a few dollars. Purchases made with a credit card come with certain consumer protections which are not available via other means. Historically this has meant a free version of insurance against the company failing to deliver. Now Allegiant is going to have customers pay for that insurance. At least the company recognizes this shortcoming when a customer clicks for the details on the debit card discount:
The move also raises an interesting question with respect to the DoT rules regarding full-fare advertising. Is the fare displayed on the search results really the all-in price if only certain customers using a specific payment method can actually realize that price? It will certainly be interesting to watch.
At the end of the day this move makes it harder for customers to easily compare total trip costs across carriers. That’s bad for passengers.
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