Credit card users surcharge of up to 4 percent

[shakalaka]

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@Anonymous wrote:

Does anyone know of any place that has started charging the fee? So far so good for me, only concern is my landlord. The only way to pay rent is in person at the office by credit or debit card. If they charge a credit card fee I would have to start looking into a prepaid debit card, get the one where I can use it fee-free hopefully. I refuse to ever get a debit card linked to my checking account due to the fact if my number is ever stolen all my money is wiped out.

Otherwise any other business where I have a choice on who to patronize it won't be anyone charging a fee for credit cards.

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Not here in the NOVA/DC area. And I guess we will not see them in many places. No one will jeopardize their business. For I use my credit cards almost 100% for everything I would just move on to the next store/retailer/business ...

[JWatson0405]

Yea they were talking about this on NPR last night.  Representative from some Retailer organization didn't think many would start to charge the additional fees as they have baked it into the price of the merchandise already.  So everyone pays this higher price already - tacking on an additional charge would just agitate the consumers, and they don't really want to do that unnecessarily.

[Duncanrr]

Ok, time I step-in and end this.  The surge charge by merchants isn't going to happen for four main reasons:

1. (most importantly) no merchant is going to do this is an open market system as customers will just bring their business elsewhere,

2. Vendors that accept AMEX will not be able to charge a fee on MC or Visa cards as their agreement with AMEX prevents them from doing so (this takes care of a number of vendors),

3. Vendors that have stores in one of the 10 states that prohibit these fees will not be able to charge the fee in any of the other 40 states as their agreements with Visa/MC prevent this; and

4. Most vendors already have a surcharge in the price of goods sold that take into account the merchant fees they have to pay MC and Visa.  Unless they reduce their prices then they would be charging the customer twice for this fee.

With all that said, its not going to happen and if you find a vendor that tries to pass on the merchant fee you should bring the items that you were going to purchase to the manager and tell them that you would had bought these items but for the surcharge and then leave the store.  Stores that charge the fee will soon stop.

(P.S.  I so wanted to hijack this thread and get into a discussion of the differences between preemption and constitutionality of various laws )

[ryanbush]

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@thom02099 wrote:

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@mxp114 wrote:

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@Walt_K wrote:

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@mxp114 wrote:

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@Cleanmachine wrote:

I understand that the Federal Judge's Order was to allow the Merchant to charge the fee. The Merchant has the option.

What would be interesting, those States that current will not allow the Merchant to charge a fee, would the Federal Judge's

decision over rule the State law???

Would this also apply to those credit card issuers who do not allow the fee????

Interesting to see what happens.

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Judiciary can only strike down laws that are unconstitutional and prohibiting a merchant fee is absolutely allowed by the constitution, thus the state laws will stand.

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Well, that's not entirely accurate.  Federal law can preempt state law.  So there are some state laws that are not in and of themselves unconstitutional, but may nevertheless be impermissible in view of conflicting federal law. 

But that's not at issue here.  The judge isn't doing anything other than approving a settlement agreement between the parties.  He's not passing on the state laws at all.

ETA: I suppose that a law that is preempted could be said to be unconstitutional because the State is acting in an area where authority is reserved to the Federal Government, ultimately by virtue of the Constitution.  So perhaps no disagreement between mxp and I.  But still, this really has nothing to do with the court passing on state law. 

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Yes if a state law conflicts with a federal law, then the federal law prevails. The only way the NY anti-surcharge law could be reversed is if congress enacts federal legislation permitting fees, the state legislators repeal the law, or the NY Court of Appeals, a federal court or SCOTUS declares the law unconstititional.

I don't think a state law that is preempted is unconstitutional. The state isn't always necessarily acting in an area reserved for the feds, it could be that the duly enacted state law simply conflicts with a federal statute. A law is only unconstititional if it conflicts with the constitution.

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Not always.  Like anything with the law, there are always grey areas.  Recently, Colorado legalised the posession and use of less than 1oz of Marijuana.  That would conflict with existing Federal law.  But there is no challenge to the Colorado law.  Same thing with same-sex marriage.  DOMA defines marriage as between a man and a woman, and yet in 2012 4 more states approved same-sex marriage by action of the voters.  That could be construed as a conflict with Federal law.  So Federal law does not always preempt State law. 

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Even though Colorado law says it's legal, you could still be arrested by federal law enforcement for violating federal laws.  The second example is a little different, it's not a federal offense to marry someone of the same sex there for is not punishable my imprisionment for a mininum of one year like your first example.

[bs6054]

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@Duncanrr wrote:

Ok, time I step-in and end this.  The surge charge by merchants isn't going to happen for four main reasons:

1. (most importantly) no merchant is going to do this is an open market system as customers will just bring their business elsewhere,

2. Vendors that accept AMEX will not be able to charge a fee on MC or Visa cards as their agreement with AMEX prevents them from doing so (this takes care of a number of vendors),

3. Vendors that have stores in one of the 10 states that prohibit these fees will not be able to charge the fee in any of the other 40 states as their agreements with Visa/MC prevent this; and

4. Most vendors already have a surcharge in the price of goods sold that take into account the merchant fees they have to pay MC and Visa.  Unless they reduce their prices then they would be charging the customer twice for this fee.

With all that said, its not going to happen and if you find a vendor that tries to pass on the merchant fee you should bring the items that you were going to purchase to the manager and tell them that you would had bought these items but for the surcharge and then leave the store.  Stores that charge the fee will soon stop.

(P.S.  I so wanted to hijack this thread and get into a discussion of the differences between preemption and constitutionality of various laws )

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As discussed elsewhere, debit cards are now more used than credit cards (~2:1 ration in transactions) so it seems that there is a market opportunity for a retailer to reduce prices, to remove the baked-in fee, and then apply the credit card surcharge for those that use them.  That would be fair, and people could make informed decisions (are the rewards for this transction worth the extra price).

[Duncanrr]

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@bs6054 wrote:

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@Duncanrr wrote:

Ok, time I step-in and end this.  The surge charge by merchants isn't going to happen for four main reasons:

1. (most importantly) no merchant is going to do this is an open market system as customers will just bring their business elsewhere,

2. Vendors that accept AMEX will not be able to charge a fee on MC or Visa cards as their agreement with AMEX prevents them from doing so (this takes care of a number of vendors),

3. Vendors that have stores in one of the 10 states that prohibit these fees will not be able to charge the fee in any of the other 40 states as their agreements with Visa/MC prevent this; and

4. Most vendors already have a surcharge in the price of goods sold that take into account the merchant fees they have to pay MC and Visa.  Unless they reduce their prices then they would be charging the customer twice for this fee.

With all that said, its not going to happen and if you find a vendor that tries to pass on the merchant fee you should bring the items that you were going to purchase to the manager and tell them that you would had bought these items but for the surcharge and then leave the store.  Stores that charge the fee will soon stop.

(P.S.  I so wanted to hijack this thread and get into a discussion of the differences between preemption and constitutionality of various laws )

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As discussed elsewhere, debit cards are now more used than credit cards (~2:1 ration in transactions) so it seems that there is a market opportunity for a retailer to reduce prices, to remove the baked-in fee, and then apply the credit card surcharge for those that use them.  That would be fair, and people could make informed decisions (are the rewards for this transaction worth the extra price).

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Transactions are one aspect of this.  I would like to find out the total purchased.  My guess is that credit  purchases are equal or greater than the debit card purchases.

[Walt_K]

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@Duncanrr wrote:

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@bs6054 wrote:

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@Duncanrr wrote:

Ok, time I step-in and end this.  The surge charge by merchants isn't going to happen for four main reasons:

1. (most importantly) no merchant is going to do this is an open market system as customers will just bring their business elsewhere,

2. Vendors that accept AMEX will not be able to charge a fee on MC or Visa cards as their agreement with AMEX prevents them from doing so (this takes care of a number of vendors),

3. Vendors that have stores in one of the 10 states that prohibit these fees will not be able to charge the fee in any of the other 40 states as their agreements with Visa/MC prevent this; and

4. Most vendors already have a surcharge in the price of goods sold that take into account the merchant fees they have to pay MC and Visa.  Unless they reduce their prices then they would be charging the customer twice for this fee.

With all that said, its not going to happen and if you find a vendor that tries to pass on the merchant fee you should bring the items that you were going to purchase to the manager and tell them that you would had bought these items but for the surcharge and then leave the store.  Stores that charge the fee will soon stop.

(P.S.  I so wanted to hijack this thread and get into a discussion of the differences between preemption and constitutionality of various laws )

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As discussed elsewhere, debit cards are now more used than credit cards (~2:1 ration in transactions) so it seems that there is a market opportunity for a retailer to reduce prices, to remove the baked-in fee, and then apply the credit card surcharge for those that use them.  That would be fair, and people could make informed decisions (are the rewards for this transaction worth the extra price).

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Transactions are one aspect of this.  I would like to find out the total purchased.  My guess is that credit  purchases are equal or greater than the debit card purchases.

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According to the stats earlier in the thread, it was rougly the same for 2011, a little higher for credit card spend.  I was surprised as I would have thought that CC would be much higher.  I wonder if the numbers were more skewed in say 2007.

[bs6054]

http://www.census.gov/compendia/statab/2012/tables/12s1187.pdf  shows that the gap is narrowing.

Estimated 2012 Debit card transactions:  $B2,089

Estimated 2012 Credit card transactions: $B2,378

This compares to 2009, where the debit figure was 1,449 vs credits 1,944 ($B)

[ryanbush]

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@bs6054 wrote:

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@Duncanrr wrote:

Ok, time I step-in and end this.  The surge charge by merchants isn't going to happen for four main reasons:

1. (most importantly) no merchant is going to do this is an open market system as customers will just bring their business elsewhere,

2. Vendors that accept AMEX will not be able to charge a fee on MC or Visa cards as their agreement with AMEX prevents them from doing so (this takes care of a number of vendors),

3. Vendors that have stores in one of the 10 states that prohibit these fees will not be able to charge the fee in any of the other 40 states as their agreements with Visa/MC prevent this; and

4. Most vendors already have a surcharge in the price of goods sold that take into account the merchant fees they have to pay MC and Visa.  Unless they reduce their prices then they would be charging the customer twice for this fee.

With all that said, its not going to happen and if you find a vendor that tries to pass on the merchant fee you should bring the items that you were going to purchase to the manager and tell them that you would had bought these items but for the surcharge and then leave the store.  Stores that charge the fee will soon stop.

(P.S.  I so wanted to hijack this thread and get into a discussion of the differences between preemption and constitutionality of various laws )

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As discussed elsewhere, debit cards are now more used than credit cards (~2:1 ration in transactions) so it seems that there is a market opportunity for a retailer to reduce prices, to remove the baked-in fee, and then apply the credit card surcharge for those that use them.  That would be fair, and people could make informed decisions (are the rewards for this transction worth the extra price).

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The only problem I see with that thinking is I don't believe that businesses will actually lower their prices, they will just tack on the fee and put the extra 3% on their bottom line while leaving prices the same

[mxp114]

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@thom02099 wrote:

Not always.  Like anything with the law, there are always grey areas.  Recently, Colorado legalised the posession and use of less than 1oz of Marijuana.  That would conflict with existing Federal law.  But there is no challenge to the Colorado law.  Same thing with same-sex marriage.  DOMA defines marriage as between a man and a woman, and yet in 2012 4 more states approved same-sex marriage by action of the voters.  That could be construed as a conflict with Federal law.  So Federal law does not always preempt State law. 

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Always. The marijuana laws are fairly new and subject to challenge, as they do conflict and ultimately the federal courts would declare that the federal anti-marijuana laws prevail. Now a twist would be if a federal court decides that the issue of marijuana is for the states to decide and thus the federal law would be declared unconstitutional. It can get complicated. DOMA precludes the fed gov from recognizing same-sex marriages but does not criminalize nor define marriage for the states, it reserves that determination for the states. So states that permit, are in compliance of federal law here.