Credit Card Merchant Fee

[Artemis Windsong]

www.nytimes.com/2012/07/14/business/mastercard-and-visa-settle-antitrust-suit.html?_r=1

This sounds like credit card users will be paying a fee to merchants for the privilege to use their credit card.

I really hope that doesn't happen as so many people are signed up for automatic bill pays with c.c. and are dialed in to get the card rewards.

[TD2K]

Few of my credit card rewards would justify that type of a surcharge so I would be switching over to using a debit card or going back to cash.

[Deleted]

We use our cc for EVERYTHING (in fact I haven't carried cash or the check book for over 15 years). Plus we pay most of our bills with cc's. While I enjoy the 1% back that we get, a $2.50 fee (or anything remotely close to that) would make them impractical. Looks like we will go to all cash.

[mrsdutt]

I read about the fees the other day. I will use cash if I buy anything at all. Food and gas. The buck would stop there.

[TheOtherMe]

Saw this discussed on television today. Said it will be interesting to see who all decides to implement this.

I may have to change my spending habits, depending on how things go.

Sam's Club doesn't offer the option of paying cash for gas. They also don't allow Amex cards. That probably won't change.

I would have to ease in to it instead of implementing this all at once since all of my bills are automatically paid by credit card now. I couldn't switch all at once.

[TD2K]

I saw one article talking about this and who might add this on. One mentioned were airlines and I can see them jumping on this bandwagon. For a lot of flights, paying in cash isn't an easy option and it would be another source of income and even another way of putting in a ticket increase.

[Deleted]

Whatever happened to notions of Usury laws? A lot of what these merchants are doing is electronic stealing with ridiculous nonsensical fees. Bait and switch and scam. It gets tiresome. I used to be more critical of people who got into CC trouble but now i realize how they can take a small debt and charge ridiculous interest rates, fees and so forth and totally screw people.

[Deleted]

And as for checks, there is no reason they can't charge a fee for paper checks either and no doubt they will.

[mrsdutt]

If mainstream America were smart, they would stop purchasing anything other than necessities to fight back. After all the dollar does speak volumes in this country.

[Deleted]

In our era of instant gratification, i dont' think that is going to happen. People still seem to have plenty of money to buy stuff, shop and eat out.

[mrsdutt]

Jul 15, 2012 9:12:35 GMT -5 @lonewolf said:

Jul 15, 2012 8:47:23 GMT -5 mrsdutt said:

If mainstream America were smart, they would stop purchasing anything other than necessities to fight back. After all the dollar does speak volumes in this country.

You're probably right, but it will just be another nail in the coffin of our economy.
I just hate being held hostage by the banks or the government.

As DH would say, "I hear ya."

[susanb]

It seems like a lot of people think that the credit card companies are going to start charging consumers fees. That is not what the article says.

Previously, credit card companies banned merchants from charging credit card customers more even though credit card purchases cost merchants more. Now, merchants are allowed to charge customers a fee, passing along the cost of doing business. It is very expensive to process credit cards/debit cards. If you make a purchase for $100, it likely costs the merchant around $5 or 5% since they have to pay a percentage to the merchant processor and the cc company, along with a host of other tech and software expenses.

It is now up to the merchant. DH and I own a company that processes credit cards. We will not be charging credit card fees to our customers. Some companies will. Airlines, for example, likely will since a $5 fee is insignificant if the airline has a better fare overall. Your local bakery or grocery store, places that depend on repeat business and have thin margins likely won't, at least for now.

[Tiny]

But isn't the transaction fee already kinda figured into the price of what merchants offer for sale (if they except debit/credit) cards? I'm thinking this isn't gonna be that big a deal. Small merchants will simple post a sign about their policy (many of them don't take credit cards for charges under $20.00 <- atleast in my neighborhood). I'm also thinking for big ticket purchases people (my self included) would probably pay a little bit extra for the convenience of using a credit card. Big ticket meaning a final bill total over $250.00. I'm not especially fond of the idea of walking around with a lot of cash or jumping thru alot of hoops to use a check.

Personal checks give merchants a whole nother set of headaches...

I might speculate that 'store cards' would make a booming comeback if stores were to start adding a fee for using a Visa/Mastercard/Discover/AmEX. There probably wouldn't be a fee to use the Stores 'store card' or 'store branded Visa/MC/etc'... That might be good or bad...

[TheOtherMe]

Jul 15, 2012 4:19:59 GMT -5 @shooby said:

And as for checks, there is no reason they can't charge a fee for paper checks either and no doubt they will.

Presently all of my checking accounts are free. Would they stay that way if everybody starts using checks again.

Checks to present merchants with a new set of problems. They can bounce.

I'm the secretary at a church and we had a donation check bounce. Cost the church money that it didn't have to lose.

[kadee79]

Jul 15, 2012 13:25:23 GMT -5 Tiny said:

But isn't the transaction fee already kinda figured into the price of what merchants offer for sale (if they except debit/credit) cards? I'm thinking this isn't gonna be that big a deal. Small merchants will simple post a sign about their policy (many of them don't take credit cards for charges under $20.00 <- atleast in my neighborhood). I'm also thinking for big ticket purchases people (my self included) would probably pay a little bit extra for the convenience of using a credit card. Big ticket meaning a final bill total over $250.00. I'm not especially fond of the idea of walking around with a lot of cash or jumping thru alot of hoops to use a check.

Personal checks give merchants a whole nother set of headaches...

I might speculate that 'store cards' would make a booming comeback if stores were to start adding a fee for using a Visa/Mastercard/Discover/AmEX. There probably wouldn't be a fee to use the Stores 'store card' or 'store branded Visa/MC/etc'... That might be good or bad...

Since I have never given up using checks (I don't have an ATM card..don't want one)....from personal experience, most stores are set up so that a paper check run through acts the same as using a debit card. If your check is returned to you...that is what has happened.
We only have a couple of stores in my area that aren't set up that way. It will show on your bank statement as an electronic transfer of funds...or it should. That's how it shows on our bank statements.

[Mardi Gras Audrey]

I can't see most merchants from adding CC fees. While CCs do cost the merchant money for processing, there are costs associated with other forms of payts (checks-bouncing, time to process, etc and cash-security, potential for theft, having to deposit while bank is open).

I also remember reading that people who use CCs tend to buy more/spend more money. That could be worth the extra sales, particularly for places like restaurants and gas stations. That is one of the reasons places like McDonalds accept CCs (and not just cash). If you would get a sale of $4 to someone with cash but a sale of $7 to someone with a CC, that sales increase is worth the 2% processing fee. Especially given that you don't have to worry about the increased risk of having your employees held up or having theft by employees.

[Artemis Windsong]

I just got most of my monthly bills set up for automatic cc charge.

If I were a merchant and knew I was going to charge more for the use of cc, I would just up all the merchandise by that much and skip penalizing the cc user.

My gas/electric co. charges 3% for cc use. So does the county to pay taxes; yet, the sport/workout facilities that are city owned, allow cc.

I will switch back to online bill pay and really miss those reward dollars.

[thyme4change]

If I were a merchant and knew I was going to charge more for the use of cc, I would just up all the merchandise by that much and skip penalizing the cc user.

Why not just raise your prices now?

Merchants will do what all the other merchants do - raise prices, add the fee on, not change the structure. If they don't, they won't stay competitive.

[marvholly]

I already operate on a cash basis for most of my routine spending: groceries, house supplies, mani/pedi, clothes...............Single exception is gasoline. Prefer by a WIDE margin pay at the pump.

After that I will go the check route.

There is something else shortsighted merchants might not be considering: not only does it cost time (employee pay+ bennies) to handle checks and the danger of NSF issues but MANY banks charge a per item fee for deposits. We had this back when Late DH & I had a business.

I suspect we might see a BIG return to single merchant cc vs the general purpose like Visa/Discover/AmEx/Mastercard. Kohl's & Target have already gone this route.