I have come to the conclusion that Ryanair are being ripped off on the credit cards charges they pay to the banks. How? – well compare these online purchases:
on Ryanair.com: The credit cards charges on a €5 customer purchase is €10.00. This charge is passed on to the customer. This translates to a rate of 200%.
on PuddleDucks.ie: The credit cards charges on a €5 customer purchase is €0.11 (that’s 11 cents). This is not passed on to the customer. This translates to a rate of 2.2%.

I first thought that Ryanair could have been profiteering or trying to screw extra money from the customer. But I checked online and it appears that it’s not the case! Ryanair state the following in the FAQ on their website.
To defray the substantial administration costs we incur when processing credit and debit cards or ELV direct debits a handling fee applies to each passenger per flight segment.
So if we are to take Ryanair at their word, then the logical conclusion is that Ryanair are paying exorbitant rates to the banks for processing credit cards on their website. Almost 100 times more than little PuddleDucks are paying.
If I were them, I would begin a serious renegotiation with their bank or credit card processor. It looks like they are being ripped off royally. By renegotiating the charges down to the 2.2% that PuddleDucks are being charged, they could dramatically reduce the bottom line cost of their flights to their customers.
As an example, I booked a return flight from Cork to Dublin last week. I was charged €5 for the flight and €10 for the luxury of using a credit card. If Ryanair managed to renegotiate their charges to get a similar deal as PuddleDucks, the cost of the flight would be €5.11 rather than €15.
By the way, if Ryanair don’t manage to successfully renegotiate their charges, I have heard about two tips that can help the customer avoid them. I haven’t tried them out but hopefully they should work.
1. Purchase a Gift Voucher from the Ryanair site. This does not attract credit card charges (why not?). Then use the voucher to book your flight. Slight drawback – the minimum denomination of the voucher is €25 and as expected, Ryanair will not refund or give change for any unused funds..
2. Buy an EntroPay card (select GBP as the currency) and use this when paying for flights on the Ryanair website. It is seen as a Visa Electron card which does not attract credit card charges. You pay around 5% commission for the use of the card – a lot less than the charges imposed by Ryanair. The process is described in detail on the Bargains for Irish Consumers blog here.
Thanks to John Peavoy and Anthony Creswell for the above tips (via Twitter of course).