Finance Charge FAQ

1. Why did BNSF implement finance charges?

• Encourage customers to pay their bills within the specified credit terms.
• Nearly all other businesses do assess finance charges.

2. Will customers receive one finance charge bill or separate bills?

• Customers will receive one bill per month for each pay location (patron code).
• Customers will receive separate bills for freight and miscellaneous finance charges.

3. For customers who dispute a bill, how will the finance charge affect them?

• When a customer notifies BNSF that they are disputing a bill and advises their reason why, the bill will be put into a disputed status, which is not subject to the finance charge. The clock stops during the time the charge is in dispute.

4. Who should a customer contact regarding the finance charge?

• To discuss the finance charge in principle, please contact your Marketing Representative.  Questions regarding an assessed Finance Charge bill that the customer feels is in error should be directed to the BNSF contact shown on the bill.

5. Is the monthly 'snap shot' taken at the same time every month?

• Yes, we plan to issue Finance Charge bills on the 5^th working day of each month.

6. If a customer uses a third party to pay their freight bills, will they still be subject to the finance charge?

• Yes. Many customers use a third party to efficiently handle their freight bill payments.  However, the customer will still be responsible for any finance charges that accrue due to the failure of the third party to process payments within BNSF credit terms.

7. Under what legal authority are you charging a finance charge?

• There are no longer any prescribed credit provisions in the Code of Federal Regulations governing carriers. Therefore, carriers are free to set their own credit terms, which would include finance charges.  The credit provisions used to be in the Code of Federal Regulations, Title 49, Part 1320, but they were deleted about four years ago. Since the 1980's, the following provision was in Part 1320.2, "Carriers may, by tariff rule, establish service charges for payments made after the expiration of an authorized credit period."

8. Is the 15-day Carload credit term (or 7-day Intermodal credit term) for freight bills calculated from the bill of lading date or waybill date?

• No, it is calculated from the date the freight bill was issued.

9. We pay our bills to BNSF through electronic payment. Will we be subject to the finance charge?

• Payment made electronically must still be within the BNSF credit terms.  Electronic payment offers a customer more control over when the payment is actually received by BNSF and can help avoid finance charges. However, if certain bills are not paid or not disputed, then they will be subject to the finance charge.

10. The credit terms for Carload freight bills are 15 days from freight bill date (7 days from freight bill date for Intermodal freight bills).  If I pay in 16 days (for Carload, or 8 days for Intermodal), will I be assessed 1% for paying one day late?

• The finance charge is 1% per month or 12% per annum prorated on a daily basis for each day that the payment is past credit terms. This equates to $0.33 per day for each $1,000 past credit terms.  The finance charge continues to accrue daily until the date payment is received by BNSF, not the date payment is made or the date postmarked on the payment.