Will we be charged for swiping credit?

[Anonymous]

Small business I walked into for lunch... I asked if I would be charged any extra for choosing credit. They said not right now. The clerk went into detail about some lawsuit with credit card companies and charges and acted like something was coming down the line where they would be charged 1 point something percent per transaction and the consumer would be charged 3 point something.

What was that all about?

[Anonymous]

CC companies always charge retail merchants a fee. The merchant doesn’t have to take credit if they don’t want to, but they’re missing out on a lot of business if they don’t. Did the business ask you prior to your purchase whether it would be cash/debit/credit? If not, let them give you the price and pay in whatever form they accept. Many merchants also have variable prices to offset CC fees, so that’s really not anything new.

[Anonymous]

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@Anonymouswrote:

Small business I walked into for lunch... I asked if I would be charged any extra for choosing credit. They said not right now. The clerk went into detail about some lawsuit with credit card companies and charges and acted like something was coming down the line where they would be charged 1 point something percent per transaction and the consumer would be charged 3 point something.

What was that all about?

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Sound like the average guy who wants to sound smart but has no idea what he talks about because thats a great way to kill the credit card business.

[Anonymous]

Never heard of such news until now but some corner stores will charge a small fee if you use a credit card and pay for something under $10.

[iheartwings]

Wonder if this person was talking about the current case at the Supreme Court, Ohio vs American Express, which is an antitrust suit. AmEx  contractually prohibits businesses from suggesting the use of other cards that have lower swipe fees, and by doing so, are accused of limiting competition.  (On the flipside, AmEx argues that higher swipe fees are needed to pay for perks they give customers via rewards). 

https://thepointsguy.com/2018/02/supreme-court-antitrust-claims-amex/

[Gregory1776]

You already pay Credit card fees, whether you use cash or credit, you pay a bit more because businesses raise the price a bit to offset fees. Just like taxes. Every thing we buy is more expensive because of Taxation and we don’t even see or think about the extra cost....

Businesses aren’t in business to make Credit cars companies money.

[Anonymous]

I know many restaurants pass the cost of a credit card tip transaction on to the employee.  For example, if the guest check is $40 and they tip $10 on the CC for a total of $50, the merchant will pay the 3% (or whatever) on the $40 but the employee (server, bartender, cashier) will pay the 3% on the $10, receiving $9.70 in this example.

[RobertEG]

If the clerk did not even know whether what was coming down the line involved a decision in a single pending case, a class action suit, a proposed state reg or statute, or an over-arching federal reg or legislation, I would chalk it up to chatter and rumor.

Federal rulemaking or legislation would be widely published and generally known, so it is doubtful that any such proposals are pending that would have any general implications.

[AppHappyTog]

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@Anonymouswrote:

I know many restaurants pass the cost of a credit card tip transaction on to the employee.  For example, if the guest check is $40 and they tip $10 on the CC for a total of $50, the merchant will pay the 3% (or whatever) on the $40 but the employee (server, bartender, cashier) will pay the 3% on the $10, receiving $9.70 in this example.

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Typically that 3-6% restaruants have servers pay is for tip out to bar and table cleaning staff. Atleast that's how it worked in all the restaurants I worked in as a bartender.

I agree with previous posters, businesses are typically smart enough to add that extra cushion into their pricing to accomodate the fees they'll pay. I own a service related business and 99% of my revenue comes from credit/debit cards and I have the expecation that 100% of my revenue will come from credit cards and I'll be paying processing fees, its just the cost of doing business. I've run into many small businesses that will offer you a cash pay discount and my local UPS store won't allow you to use any card on a purchase unless it's over $15.

[Anonymous]

Good comments from all.  As AppHappy just pointed out, almost all businesses just view it as part of the cost of doing business.  In the same sense customers also pay for toilets, plumbing, electric lighting, air conditioning, cost of replacing the stove and fridge, etc.  It's all part of the price of your hamburger.

It may also be worth observing that there are also costs associated with being paid in cash.  Employees and robbers steal it, it can be lost, you have to make special trips to the bank to deposit it, you have to count it, it spreads disease (cold and flu germs) amongst your employees who touch it, etc.