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Valued Contributor
afbar1114
Posts: 2,179
Registered: ‎01-09-2012
0

Re: Do you Know your card?

that is true but whats going to happen will be they cant buy other things...its going to be a mess for awhile but i am sure things will change when they relize whats going to happen..i feel that we already pay for those fees...they are built into the price of the product that some will just make extra money on it


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Valued Contributor
android01
Posts: 1,226
Registered: ‎09-22-2009
0

Re: Do you Know your card?


LesWH wrote:

afbar1114 wrote:

this is not what the country needs now its going to hurt alot of businesses and alot of people


I agree it's going to hurt people.  How is it going to hurt businesses?  They will be passing the fees on to the consumer.


You got that right.  When one is dealing with a 10% margin on sales, 3% matters A LOT to accept credit cards.  When thinking about all all the expenses in having a sales force including salary, medical, 401K, warehouse utilization, communication expenses etc - and that's just to be able to compete.  Not to mention that when people pay with rewards VISA or MASTERCARD credit cards, the percentage is invariably higher.  Credit card sales are horrible for vendors who accept credit cards. AMEX is the worst.  It's becoming a real problem, especially in the industry I'm in to accept credit cards. What do I do to accept credit cards?  I reduce pay, I reduce the number of people that I employ, and I encourage cash only sales and services.  Credit card usage by my customers in my line of business is detrimental.  Will I pass this on to the consumer ? Yes, because I have to to stay in business.    

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Senior Contributor
Open123
Posts: 4,219
Registered: ‎02-23-2011
0

Re: Do you Know your card?

[ Edited ]

In my view, the credit cards rewards system (especially Amex) allows for a transfer of wealth to the credit card issuer and the cardmember.  

 

What I mean by "transfer of wealth" is the fees incurred by merchants to subsidize a card user's rewards is passed onto other consumers by the merchant.  So, in essence, because of the merchant fees associated with rewards cards, goods are higher priced than they otherwise would be if the merchant doesn't have to incur these fees, or if he's allowed to discount the fee for "non rewards" cards payments, which has a lower associated merchant fee.

 

Those who pay cash, use debit cards, and otherwise non rewards cards end up paying a higher price than necessary to subsidize the high rewards cards.  All things being equal, this inherently places an unfair burden on those living with limited income who can't or otherwise wouldn't qualify for "high" rewards cards.

 

I don't think the law will work, but the spirit of it is admirable.  Mainly, it won't work because merchants will *never* pass the savings to the consumer.

Frequent Contributor
jake619
Posts: 496
Registered: ‎11-13-2012
0

Re: Do you Know your card?

The precedent for Americans to pay for gas at increased cost already exists.  I suspect it holds true for food as well; hard to imagine otherwise.

 

Historically Visa has not permitted retailer surcharging, but allowing surcharging was a key provision required by merchants to settle long-standing litigation brought by a class of retailers in 2005. 

 

It will be interesting to see how the V and MA stocks fare in the next few weeks.  I can't see how this increases swipe fees.

 

 


GangnamFICO wrote:

Because the chicks dig it when I throw down the card to the waiter and...it comes in handy if I'm short on cash until payday and need a short spot. AMEX gets the booty, and that's important when you're a Pirate.


Minor vulgarity edit --Rev



Valued Contributor
android01
Posts: 1,226
Registered: ‎09-22-2009
0

Re: Do you Know your card?

If it was easy, we'd all be rich.

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Regular Contributor
ceemee2203
Posts: 201
Registered: ‎07-27-2012
0

Re: Do you Know your card?


LesWH wrote:

afbar1114 wrote:

LesWH wrote:

afbar1114 wrote:

this is not what the country needs now its going to hurt alot of businesses and alot of people


I agree it's going to hurt people.  How is it going to hurt businesses?  They will be passing the fees on to the consumer.


becasue people will not buy stuff if the have to buy more...if a family needs to get food on credit becasue they can not afford to pay cash right away. its going to be a big deal soon and gas stations will most likly the first to impose this fee...


I think if people need food and need to pay with credit, they are going to pay that extra fee, rather than go hungery.  Samne with gas.  If they need to get to work/school/ wherever, they are going to get the gas....


Yes, they will pay...someone else. I certainly would.

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Valued Contributor
android01
Posts: 1,226
Registered: ‎09-22-2009
0

Re: Do you Know your card?


Open123 wrote:

In my view, the credit cards rewards system (especially Amex) allows for a transfer of wealth to the credit card issuer and the cardmember.  

 

What I mean by "transfer of wealth" is the fees incurred by merchants to subsidize a card user's rewards is passed onto other consumers by the merchant.  So, in essence, because of the merchant fees associated with rewards cards, goods are higher priced than they otherwise would be if the merchant doesn't have to incur these fees, or if he's allowed to discount the fee for "non rewards" cards payments, which has a lower associated merchant fee.

 

Those who pay cash, use debit cards, and otherwise non rewards cards end up paying a higher price than necessary to subsidize the high rewards cards.  All things being equal, this inherently places an unfair burden on those living with limited income who can't or otherwise wouldn't qualify for "high" rewards cards.

 

I don't think the law will work, but the spirit of it is admirable.  Mainly, it won't work because merchants will *never* pass the savings to the consumer.


If you understood what kind of margins there are you wouldn't complain.   Folks that sell goods and services have to make *something* in order to stay in business to provide the consumer with what they want and need. 

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