topic Re: Mastercard and Visa Lawsuit settlement and Retailer Surcharges in Credit Cards

Mastercard and Visa Lawsuit settlement and Retailer Surcharges

Anonymous — Sat, 14 Jul 2012 00:15:57 GMT

I just read an article on times website that credit card companies and retailers just settled a lawsuit for 6 Billion dollars, plus 8 months of lower interchange fees AND, what will impact consumer, striking provisions in credit card agreements that stipulate that Retailers cannot surcharge card users for using their cards. thus whether one uses amex visa mastercard discover or whatever, the retailer can take that $100 item and charge you $102 or $103 or more. you could still pay by cash or check the $100 but this strikes me, to put it mildly, as lame. why bother paying for a rewards card when the rewards are outweighed by the costs of actually using the card. I see a loss of incentive. This seems to be the death of credit cards as a great short term loan with a small 1-5% perk that makes everyones lives, including merchants, easier, safer, and quicker at checkout. I still cringe when I get behind the old ladies who write out checks. In Australia they started this back in 2003 and some places were charging 5%+, way more than needed to recoup interhange fees, until it was reigned in. if myfico had a dislike button I would press it twice for this new rule. If merchants try this it will drastically change how we all view and use credit cards... boo

Re: Mastercard and Visa Lawsuit settlement and Retailer Surcharges

flowfaster — Sat, 14 Jul 2012 00:56:04 GMT

Well that sucks....

Re: Mastercard and Visa Lawsuit settlement and Retailer Surcharges

steve23111 — Sat, 14 Jul 2012 00:56:18 GMT

I see this as driving down the cost of those card processing fees, thus eventually making it such a trivial amount that it would not be worth passing on.

Re: Mastercard and Visa Lawsuit settlement and Retailer Surcharges

Essence — Sat, 14 Jul 2012 01:28:24 GMT

Forgive me for not understanding fully. Is this similar to gas then? Having two separate prices for cash and credit purchases?

Re: Mastercard and Visa Lawsuit settlement and Retailer Surcharges

steve23111 — Sat, 14 Jul 2012 01:32:27 GMT

@Essence wrote:
Forgive me for not understanding fully. Is this similar to gas then? Having two separate prices for cash and credit purchases?

No. This means tacking on a specific percentage on top of the purchase price to cover/recoup credit card processing fees. Currently, this is (generally) not allowed by the credit card companies.

Re: Mastercard and Visa Lawsuit settlement and Retailer Surcharges

Anonymous — Sat, 14 Jul 2012 01:43:49 GMT

Will be interesting to see how this all plays out. Which merchants will have the guts to do this.

Some very good consumer friendly info I found. If a store implements the surcharge they have to advertise it on the entrance to the store, at the checkout, and finally again on the final recept. So basically if I walk to the front entrance of a store and read they charge extra for credit cards, I keep on walking.

Hopefully by shopping around I can still get and keep my chase sapphire preferred that I have a goal for and find enough merchants that want my business to keep using the card worthwhile.

Worst case scenario all merchants collude to charge the surcharge. I can cancel all credit cards except one no AF card, and go back to cash and debit. Merchants are not allowed to surcharge debit cards, only credit.

I am wondering what this means for online shopping, including hotels and airlines. A surcharge for online purchases would be quite horrible.

Re: Mastercard and Visa Lawsuit settlement and Retailer Surcharges

trumpet-205 — Sat, 14 Jul 2012 03:05:21 GMT

I actually find the whole thing to be lame for one reason. Swipe fee is already included in the price. When a product is being priced, seller will factor in swipe fee. So why in the world would these merchants demand charging additional surcharge?

If anything, these merchants should promise to lower existing price when cash and/or check is used for payment AS OPPOSED to the use of plastic. It makes no sense to charge surcharge on top of a price that already takes care of swipe fee.

Re: Mastercard and Visa Lawsuit settlement and Retailer Surcharges

Anonymous — Sat, 14 Jul 2012 03:59:34 GMT

@trumpet-205 wrote:
I actually find the whole thing to be lame for one reason. Swipe fee is already included in the price. When a product is being priced, seller will factor in swipe fee. So why in the world would these merchants demand charging additional surcharge?

If anything, these merchants should promise to lower existing price when cash and/or check is used for payment AS OPPOSED to the use of plastic. It makes no sense to charge surcharge on top of a price that already takes care of swipe fee.

Well not everything should make sense! This is the power of billion dollar lobbying

Re: Mastercard and Visa Lawsuit settlement and Retailer Surcharges

trumpet-205 — Sat, 14 Jul 2012 04:09:38 GMT

@Anonymous wrote:
@trumpet-205 wrote:
I actually find the whole thing to be lame for one reason. Swipe fee is already included in the price. When a product is being priced, seller will factor in swipe fee. So why in the world would these merchants demand charging additional surcharge?

If anything, these merchants should promise to lower existing price when cash and/or check is used for payment AS OPPOSED to the use of plastic. It makes no sense to charge surcharge on top of a price that already takes care of swipe fee.
Well not everything should make sense! This is the power of billion dollar lobbying

It is just an excuse for merchants to squeeze extra cash, and an excuse to make politician a good guy (doing a service for small business).

Re: Mastercard and Visa Lawsuit settlement and Retailer Surcharges

Booner72 — Sun, 15 Jul 2012 00:53:24 GMT

I just noticed that my little local grocery store is going to charge 25 cents to use the debit or credit card there. I'm going to find a new local grocery store for my morning coffee and odds and ends. I wonder if I should tell them how I feel since I spend a good deal there as the month goes by?

Re: Mastercard and Visa Lawsuit settlement and Retailer Surcharges

Essence — Sun, 15 Jul 2012 01:21:02 GMT

Doesn't hurt to voice your comments good or bad to management. If enough people do it, maybe that store will change back.

Re: Mastercard and Visa Lawsuit settlement and Retailer Surcharges

trumpet-205 — Sun, 15 Jul 2012 01:23:07 GMT

@Booner72 wrote:
I just noticed that my little local grocery store is going to charge 25 cents to use the debit or credit card there. I'm going to find a new local grocery store for my morning coffee and odds and ends. I wonder if I should tell them how I feel since I spend a good deal there as the month goes by?

Tell them. In fact debit card swipe fee is capped at 12 cents, so question why a swipe fee of 25 cents.

Re: Mastercard and Visa Lawsuit settlement and Retailer Surcharges

mxp114 — Sun, 15 Jul 2012 01:34:07 GMT

@Anonymous wrote:
So basically if I walk to the front entrance of a store and read they charge extra for credit cards, I keep on walking.

Terrible news and I will do the same. In fact I keep on walking when I see "cash only" signs.

Re: Mastercard and Visa Lawsuit settlement and Retailer Surcharges

Anonymous — Sun, 15 Jul 2012 01:44:46 GMT

I suspect this could impact rewards cards in a negatie way. Rewards are going to get smaller if the swipe fees go down.

Re: Mastercard and Visa Lawsuit settlement and Retailer Surcharges

trumpet-205 — Sun, 15 Jul 2012 01:52:24 GMT

@Anonymous wrote:
I suspect this could impact rewards cards in a negatie way. Rewards are going to get smaller if the swipe fees go down.

In the case of debit card, most debit card no longer has reward program.

Here however, merchants supposedly want to pass swipe fee on to consumer.

Re: Mastercard and Visa Lawsuit settlement and Retailer Surcharges

JusdoNit — Sun, 15 Jul 2012 01:57:33 GMT

That would be super stinky if they were to do that, but I am noticing that a lot of small businesses are starting to charge customers the costs they pay for us using our cards at their establishment. Like our local barbershop. Just really smelly business for a society that wants to get away from people carrying cash and writing checks.

Re: Mastercard and Visa Lawsuit settlement and Retailer Surcharges

Booner72 — Fri, 20 Jul 2012 02:13:13 GMT

Heard on the radio this morning that it costs businesses 13 percent PER TRANSACTION to use Visa/MC - wish they'd give a 13 percent cash discount - then no one would be using cc's - Paypal is only charging 8% so a lot of small business just go with them. I had no idea.

Re: Mastercard and Visa Lawsuit settlement and Retailer Surcharges

CreditScholar — Fri, 20 Jul 2012 02:14:52 GMT

@Booner72 wrote:
Heard on the radio this morning that it costs businesses 13 percent PER TRANSACTION to use Visa/MC - wish they'd give a 13 percent cash discount - then no one would be using cc's - Paypal is only charging 8% so a lot of small business just go with them. I had no idea.

Don't believe everything you hear on the radio, since that's not true. You can google the interchange fees for each card type/level, and it's nowhere near 13%.

Re: Mastercard and Visa Lawsuit settlement and Retailer Surcharges

trumpet-205 — Fri, 20 Jul 2012 02:32:47 GMT

@Booner72 wrote:
Heard on the radio this morning that it costs businesses 13 percent PER TRANSACTION to use Visa/MC - wish they'd give a 13 percent cash discount - then no one would be using cc's - Paypal is only charging 8% so a lot of small business just go with them. I had no idea.

Radio host lied. No swipe fee would be as high as 13%. Even PayPal charges only 2.9% + $0.30 (5% if transaction volume is $5 or less).

Square at most charges 3.5% for online/phone transaction.