Re: Merchants may be allowed to charge extra for credit cards
07-10-2012 06:44 PM
It basically equates to a tax that the card processors can (and will) levy on the public. They'll use the money to offer more generous rewards, which we end up paying for with higher prices. More people sign up for more cards, and viola! Cash is further reduced from the equation, further pressuring merchants to accept cards.
The end result is that cash users come out the worst, since they pay the same elevated prices merchants charge to cover the credit card costs; but ultimately all consumers lose. Oligopolies suck sometimes.
Nope. This will have quite the opposite effect. It will make rewards cards much more worthless. Even if you get 5% cash back, you then have to pay 2%+ on your transaction. Card issuers will have to bump up the rewards just so the consumer can break even on using their cards.
You're right - I misread the article. I was thinking processors were pushing for higher fees, not merchants pushing for surcharges.