Merchants Adding 4% Charge to their CC Customers

[Anonymous]

@onstar What processor is the cheaper one so I can recommend it to my friend? Yeah I think they should put it in the price as well.

[ldkcivilservant]

It's the cost of doing business and should never be passed onto the consumer. That would be like charging an Uber rider a surcharge for the gas that it costs to get them from A-B, you're already paying that within the charge for the service.

I would take my business elsewhere, and in fact already have. We have a local merchant here who 'accepts' American Express nad is in network with them but will not acutally take it because their fees are so much highter.

I don't shop there anymore, you don't get to dictate which companies I have a relationship with.

[blindambition]

Here in LV, many businesses are doing this, and calling it a COVID surcharge. I would pay cash, but I completely understand it. Not only are they paying merchant fee, but losing bookoo dollars not being able to fill restaurant or venue.

[onstar]

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@Anonymous wrote:
@onstarWhat processor is the cheaper one so I can recommend it to my friend? Yeah I think they should put it in the price as well.

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I've been using Square for my digital marketing business since 2015. It was so easy to set up that I didn't even think about fees at the time. 2 years ago when my wife started her own practice, I knew her CC volume would be at least 2x my CC volume, so we did some research to save on fees. There are so many merchants that you can use. We came down to Payline Data (interchange fees + 0.2% + 10c; monthly fee $10) or Fattmerchant (interchange fees + 8c; monthly fee $99). If the monthly CC volume is less than ~$45,000, then Payline would be cheaper.

[Anonymous]

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@Wavester64 wrote:

Around my town and State, many merchants are adopting the policy of adding 4% to the charge of their items (be it food, services, etc.) that the CC paying customer has to absorb because per the merchant, that is the cost they are charged for providing the convenience of using CCs to their customers and they are trying to get that back to sustain business.

Now because of the times we are in, one could argue that this is necessary so that the businesses being hurt have a chance to thrive.

Another argument could be that we the customers have been hit hard due to the pandemic as well, and we are trying to save as much money as we can to get by.

When I post something like this on Facebook in one of my local town groups, most of the replies are all PRO the merchant, that if we the customer don't like it, TOO BAD, PAY CASH & save money. One needs to keep in mind that most of these who reply like this are not into the CC game like we MF'ers are on this forum.

Now I'll ask it here since we are in the CC game to save money. Do you feel its right that merchants add a 4% charge to your total? If you feel its OK, would you feel the same way if there was no COVID?

I mean, yeah, I feel for the businesses, I was a business owner for MANY years and had my struggling times. But as a consumer/customer, where does it end? I mean we as consumers are getting these CCs, or looking for coupons, or buying Groupons to save money, just for the merchants to charge more anyway?

You see what I mean? Curious to see your take on this.

I mean this topic for all - but going to add a few buddies below to get their attention and hear their thoughts on this subject too.

@Gmood1 @Anonymous @Anonymous @M_Smart007 @coldfusion @Anonymous @JNA1 @cashorcharge @AllZero @Anonymous 

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I personally won't do business with companies that add surges to credit card users. If they want the business that comes from the flexibility of taking credit cards, they agree to those fees, it's not on me or anyone else to pay them extra for their business decision. If they don't find value in their merchant agreement, they should terminate it. 

[Anonymous]

Well, if a 4% fee is added for a CC purchase that more than erodes away any rewards one would get from a general 2%-3% back card.  For such a person someone would be better of using cash.  If you're talking a 4%-5% category it would still make sense to use the card I suppose, but the percentage of those transactions would be fewer.  It sounds to me like rewards cards could be pushed toward becoming obsolete at some point.

[Anonymous]

Yeah that’s exactly the point we’re turning up paying our own rewards in the end

[CreditInspired]

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@Brian_Earl_Spilner wrote:

Last I checked it was against the credit card agreement to charge a surcharge to offset the fee. There's a specific law for gas stations to be able to charge more for taking a card, but I don't remember what it is.

As for the fee itself, I really don't care about 4%. My problem is people become used to it and it doesn't go away. Prices and fees always go up and are added, but never lowered and removed. It just becomes a way of life.

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Took the words right out of my mouth

[Remedios]

I've never stolen anything, but the cost of stolen goods is baked into pricing regardless of how you pay. 

To start adding charges on top of it is offensive, they might as well add 5% surcharge for each step you take inside the store for floor damages. 

In addition, calling something "Covid-19 surcharge" is downright shameful.

Those affected by it may not be even able to pay for things they need via cash, so adding to the price makes it worse if they have to resort to using cards. 

I'm not going to get into legality of this practice, that's already been covered, but for the merchant to assume they are the only ones falling on hard times is insane.

Perhaps having a sale would be a better approach. 

[Anonymous]

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@Anonymous wrote:

Yeah... merchants aren't supposed to do this and can be penalized by the card networks/payment processors

It's not likely that they dropped their prices by 4% and then added the 4% CC fee to match; they probably just want to grab more money and tacked on the additional fee on top of the same price that already included their CC txn fees

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This, most people just raise their prices due to increased costs. And it's been happening more and more in the last few years due to a lot of factors. I think charging the fee up front for CC users specifically is going to be hot debate for several reasons. For starters it's visual proof that your 3% Rewards card is useless at those places. I get that smaller Businesses are going to be the first to "try" this appraoch due to the unfortunate circumstance we're facing today. Which will get support from just about everyone who doesn't understand the CC points game, or even those who simply agree with a cause no matter what. 

If this fee gets more widespread then it again pushes people to debit transactions over CC's to avoid the fee, thus putting your Bank account at risk. So it will definitely be a hard choice for some people on which way to go debit or CC. I don't see it going too extreme because I can't see the CCC's not wanting their products getting used over a 4% surcharge. I also don't think the supporteres will be too agreeable over time as teh 4% ads up, and it's definitely not going to go over well with lower income families who scrape by as it is.