I thought that the price of using a credit/debit card was the interest payed.

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Recently merchants have begun to add the 3% to the retail price to cover the processing charges the credit card companies charge to the merchants. Many merchants will waive this 3% charge if you use a debit card.

Somebody needs to pay for the points or cash back that credit cards offer cardholders. This comes from annual credit card fees, interest payments from cardholders who pay late, and processing fees charged to merchants.

That's how I understand it, anyway.
 
The auto dealership I retired from recently stopped absorbing the CC processing fee and started adding the fee to all transactions payed for with credit cards. Business is tough and they decided they couldn't continue to absorb the fees.
 
375hh1973 said:
Cash is inconvenient
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Cash encourages thieves. If no cash accepted, no till to steal.

And yes, the CC company charges the merchant 3% "processing fee" for your transaction. With profit margins getting tighter many now choose to pass that back to customer now. They have always done it. Its a great business you (may) pay a yearly fee, you pay interest, and they make 3-4% of every penny you spend using it. So the cash back cards split the take with you to encourage you to use it more
great racket!
 
What I hate is charging me that 3% credit card fee but not accepting cash.

If they are going to do that, then the 3% fee should have been built into their fee structure. They made it a non optional cost of delivery business. No different than property taxes, insurance, utilities, salaries… They don’t itemize those expenses on their bill.
 
There has ALWAYS been a 3% fee for using a credit card. It's just that the law was recently changed to allow merchants to charge it to the customer, rather than absorbing it themselves. In the past, whether you used a credit card or paid cash, the fee was baked into the cost of the product you were purchasing. As someone who pays cash when I can, I'm glad to see it separated out so that I only have to pay it if I'm actually using a credit card!
 
We went to granddaughters dance recital . The venue was a large theater that is owned by the City . Parking garage across the street is also City owned . EVERYTHING was plastic only , Parking , concessions etc. Little League baseball tournament last weekend . Entrance fee was card only . Concessions were cash though because the promoter didn't have any connection to it . Point being , card only is becoming more common .
 
Get used to it. It's the 21st century. Soon they'll turn all of our money into bitcoin or something similar. And not every business charges that 3% fee. Offhand, I can't think of any lately that have done that when I used a credit card. And certainly not with a debit card.
 
Denverd0n said:
There has ALWAYS been a 3% fee for using a credit card. It's just that the law was recently changed to allow merchants to charge it to the customer, rather than absorbing it themselves. In the past, whether you used a credit card or paid cash, the fee was baked into the cost of the product you were purchasing. As someone who pays cash when I can, I'm glad to see it separated out so that I only have to pay it if I'm actually using a credit card!
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As several have stated the cost of credit has been built into the retailers pricing structure, but the recent legislation has allowed the retailer to "pass it on". In my opinion people are now paying the cost twice in effect.

Remember that credit card transactions aren't executed without costs. The cash has to get back to the retailer so there is accounting and transfer labor, physical record keeping of the transactions, equipment cost, fraud costs eaten by both the CC company and the retailer etc. The theory was that accepting CC was a benefit to the merchant because their sales increase by accepting major credit cards, so initially they paid the fees, however the Visa Mastercard oligopoly led to abuses of smaller merchants who:

A: had to pay whatever they charged due to lack of competition
B: adhere to their exclusionary bylaws which excluded the only other 2 monetary networks available which were Discover and Amex (this was later overturned after years of litigation)
C: were at the mercy of the mega companies' mercenary chargeback policies

So, in effect the legislation was bad legislation. They should have targeted the lack of competition which would have reduced the merchants' costs over time.

Unfortunately, the benefit of retailers increased sales is now effectively free to them. The CC company takes the risk of the losses and this is just another junk fee to consumers while the blame is placed elsewhere.

Remember not everyone who buys that TV on credit pays the bill, but the retailer gets paid. Honestly a pretty sweet deal if you are a retailer.

Just a rant from my perspective YMMV.....
 
pawngal said:
As a business owner I consider the CC fees to be a cost of doing business. Better than the file of bad checks I had years ago.
I use a CC whenever possible, if the merchant charges a fee, I pay cash or don't shop there.
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I remember the days of me chasing bad checks.

No fun at all.
 

Unless you happen to live in a state which doesn't allow it:​

States Where Credit Card Surcharges Are Illegal​

Currently, credit card surcharging is illegal in the following states and territories:

  • Connecticut
  • Maine
  • Massachusetts
  • New York (as currently interpreted)
  • Puerto Rico
I'm not sure it's worth it to move to one just to avoid those fees though.

Jeff
SWCA #1457
 
I have noticed that for the last year or so, many local restaurants have begun adding 3% to credit card purchases. If you don’t like playing that game, use cash. Some gas stations have also started showing cash prices and credit card prices, about a dime per gallon difference. Also some stations are posting a “Quickpay” price. I do not know exactly what that is, I am guessing it is something like a debit card.
 
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