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Businesses That DO NOT Accept Cards

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John1956
Valued Member

Businesses That DO NOT Accept Cards

I have often wondered why certain types of businesses, like mortgage companies, life insurance providers, car loans, some utilities,  etc., DO NOT accept cards for payment.

 

Is it because of the costs to them, or is it because Visa/MC/Amex will not allow them to ???

 

Anyone have any first hand knowledge or experience about this ???

Message 1 of 12
11 REPLIES 11
toppers555
Established Contributor

Re: Businesses That DO NOT Accept Cards


@John1956 wrote:

I have often wondered why certain types of businesses, like mortgage companies, life insurance providers, car loans, some utilities,  etc., DO NOT accept cards for payment.

 

Is it because of the costs to them, or is it because Visa/MC/Amex will not allow them to ???

 

Anyone have any first hand knowledge or experience about this ???


I would assume it becaise if you are paying with credit , and not actual capitol (cash). Plus let alone the abuse of rewards programs.



TU 715 No apps to 05/13 cash+ 5/13!!! 738 TU CSP April 13!!!CSP approved May 13!!!


Message 2 of 12
QAMngrGirl
Frequent Contributor

Re: Businesses That DO NOT Accept Cards

Personal experience (via my job), charges are EXTREMELY easy to dispute after the fact. Costs of recoup outweigh the convenience of swiping a card for payment (for the vendor)

Message 3 of 12
distantarray
Established Contributor

Re: Businesses That DO NOT Accept Cards

2-3.5% transaction costs mainly. Also remember banks want their money, and if your using credit to pay your rent/mortgage it can get you further and further into debt lowering the chances that they will get paid on time in months to come. Why? because your using credit and not cash means you could be placing yourself further and further into debt.

 

 

But there are ways to do it for cheap. Where you pay around 1% up or down of the transaction cost out of your pocket to pay your mortgage with your credit card. So if you paid $3,000 you lost $30, but you would also get 3,000 to 6,000 points.  Now if those points are worth it to you depends on the programs you used.

 

For instance United Mileage Club card I value these points at minimum of 2.5 cents per point. but since you get 1.5 points per dollar spent that's 3.75 cents per value. So even if I pay extra 1 cent it makes sense for me to spend the $30 up front to get what I value is $112.50 for travel. If I fly first class those points can be worth as much as 9 cents on the dollar, so that could be $270 towards first class travel.

 

Even at Capital One Venture card would make sense at 2% but by a smaller margin.


total credit limits $108,400 Credit scores Ex 728 EQ 738 TU 758
Message 4 of 12
Walt_K
Senior Contributor

Re: Businesses That DO NOT Accept Cards

I've always assumed it was the swipe fees coupled with the differences in the dynamics of the transaction.  McDonalds has no problem accepting credit cards and eating that fee because you don't need a cheeseburger.  You might not frequent the restaurant if you can't use your CC.  Your mortgage company can take your house away if you don't pay.  They don't have to accept your credit card. 

 

l'm being a little facetious there because I understand there are other loan products that are not secured and that still don't take credit cards.  Still, it's not a discretionary purchase.  They know that you're generally going to pay even if they don't give you options about method of payment. 


Starting Score: ~500 (12/01/2008)
Current Score: EQ 681 (04/05/13); TU 98 728 (01/06/12), TU 08? 760 (provided by Barclay 1/2/14), TU 04 728 (lender pull 01/12/12); EX 742 (lender pull 01/12/12)
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Message 5 of 12
Madman94044
Regular Contributor

Re: Businesses That DO NOT Accept Cards

+1 above.

Because they don't have to.
Staring Score:EQ 649 TU 647 EX 644
Current Score: EQ 786 TU 699 EX 746
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Message 6 of 12
Dustink
Valued Contributor

Re: Businesses That DO NOT Accept Cards

I just look at it this way. You can't pay a loan with a loan.

Too many INQs & low AAoA so I'm off to tend the Garden.     Age:23    


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Message 7 of 12
drkaje
Senior Contributor

Re: Businesses That DO NOT Accept Cards

CC policies can also be abused. Just recently a Small business (I'm familiar with) got hosed out of $9K. The person spent three months at a program and complained to Amex that they didn't get proper service. Business owner had to take money from savings to cover operating expenses so checks didn't bounce.


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Message 8 of 12
Walt_K
Senior Contributor

Re: Businesses That DO NOT Accept Cards


@Dustink wrote:

I just look at it this way. You can't pay a loan with a loan.


That's not it at all.  Not unless the entire refinance industry just went south.  Smiley Surprised


Starting Score: ~500 (12/01/2008)
Current Score: EQ 681 (04/05/13); TU 98 728 (01/06/12), TU 08? 760 (provided by Barclay 1/2/14), TU 04 728 (lender pull 01/12/12); EX 742 (lender pull 01/12/12)
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Message 9 of 12
Dustink
Valued Contributor

Re: Businesses That DO NOT Accept Cards


@Walt_K wrote:

@Dustink wrote:

I just look at it this way. You can't pay a loan with a loan.


That's not it at all.  Not unless the entire refinance industry just went south.  Smiley Surprised


On a regular basis, it will end at some point. The mortgage company doesn't want to take on the risk. Also, they don't want to pay a fee. Same with life insurance. Although, I don't get why auto insurance accepts CC but not life insurance.

Too many INQs & low AAoA so I'm off to tend the Garden.     Age:23    


     $17k       $8.5K          Closed          $19k      $6.5k        $24.2k        Closed         $5k       Closed     $8.5k        Closed      @2.49%
Message 10 of 12
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