Assuming an average annual CC spend rate of $18,000 (per the webz), that's about $360-540 annually in transaction fees.

I guess I'm a scrooge-ish penny pincher because that would be noticeable to me. Interesting that most folks wouldn't notice it.

Does COL include some compensation for these transaction fees? COLA? If you're largely CC and not cash based, this new ruling is perhaps inflationary (one time hit unless the fees vary by year?)?

It's the vig, complain that your bank doesn't pay it out of the interest they make on your balance.

quote:

Originally posted by konata88:
Assuming an average annual CC spend rate of $18,000 (per the webz), that's about $360-540 annually in transaction fees.

I guess I'm a scrooge-ish penny pincher because that would be noticeable to me. Interesting that most folks wouldn't notice it.

Does COL include some compensation for these transaction fees? COLA? If you're largely CC and not cash based, this new ruling is perhaps inflationary (one time hit unless the fees vary by year?)?

This isn't something new, buyers have been paying the fees since shortly after credit cards became a thing...after the vendors figured out what it was costing them...they just used to roll it into the prices they charged everyone.

By breaking out the cost as a separate charge, they can advertise the product at a competitive price and allow the customer to choose between convenience of not having to carry/get cash or carrying enough for random purchases.

I don't think it is a matter of folks not noticing the fee, I think it is viewed as just part of the cost of making purchases...like sales tax

Did anybody force retailers to accept credit cards? If retailers don’t want to pay the fees, then they don’t have to accept the cards. This surcharge is a money grab. Retailers have no interest in going back to cash, rather they figure the customer is too lazy and stupid to vote with their wallets.

Seems like only last decade or so have I really seen 2 prices and in the last 1-2 years it’s everywhere. Restaurants especially. Even my local gun store has a sign that says we add 3% for credit card.

As long as it’s fully disclosed up front. It’s the find out at end that grinds my gears.

That being said. I bought a 10k air conditioner this summer. In FL. I needed it. They didn’t flinch at the credit card and sayy it’s extra. So obviously some business build that 3% into their pricing.

No one forced retailers or consumers. Credit card use started slow and was promoted by the card companies as simply "add on business". All their traditional customers would continue paying as usual with checks or cash. Card use gradually increased to the point most of those who used to pay by check simply use a credit card. And why not it doesn't cost them any more?
Retailers could just raise every price 3-4% but then they would be gouging their customers that pay by cash or check. The only fair solution is to itemize the card fee as a separate charge, those who choose to use it can pay the card cost those who don't will not. I'm pretty sure this is already the case with the federal government if you use a credit card to pay your income tax. They receive the entire amount and the card user pays the processing fee to their credit card company.

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Originally posted by DanH:

quote:

Originally posted by Bluecobra:
I gave the clerk 20.55 for a 10.55 purchase. She keyed the cash tendered as 205.50. She told me that she would have to get the manager to void the transaction or she would be out of balance? I said, just give me 10 back and we are good. She refused. The manager came over and I told him the solution. He looked at me like I was crazy and said he had to void out the transaction.......

Are people really that dense?

I'm afraid you're the dense person because according to their records you paid 205.50 instead of 20.55. If that isn't voided out and re-rung properly, Loss Prevention and the Cash Office are going to be all over them because according to their records the cashier stole $194.95 from you. Once the sale was completed with the wrong amount, it has to be voided so their records are correct.

Ahhh, no. When the clerk entered 205.50 it showed that she owed me 194.95. As long as she does not do that but just gives me the 10, she is in balance. The register just needs 10.55 to be in balance and I paid that.

By the same token, what if she had entered that I paid exact change and I then gave her 20.55 and she gave me a 10 back. Would she be out of balance? NO she would not.

But thanks for giving me an answer to my question. Stick to using your cc. The math of cash can be difficult.

quote:

Originally posted by trapper189:
Did anybody force retailers to accept credit cards? If retailers don’t want to pay the fees, then they don’t have to accept the cards. This surcharge is a money grab. Retailers have no interest in going back to cash, rather they figure the customer is too lazy and stupid to vote with their wallets.

Everyone I know with small businesses, including myself loves cash over credit card. In my business I don't have a lot of monthly customers but the customers I have, have very large bills and get billed on the first. A lot of their bills are vendors I hired, managed, paid, and tacked on a 10% management fee. But it might be 30-45 days before I get my money back that I paid a vendor. So suppose I pay a vendor $10000 on November 2nd and bill the customer $11000 on December 1st, and he pays on December 15th, my profit cash is $1000 (which isn't a lot for managing the vendor AND fronting the money for 45 days), if someone pays with a credit card the fee is $330, that's 33% of my profit, why would I NOT pass that on? That's a ton of money out of my pocket. A lot of businesses operate with low markup, so the credit card eats into their profit a lot more than most consumers think. Inflation has eaten into businesses profit a lot more than they've been able to raise the price. SO yes, in a lot of businesses the 3% fee REALLY matters. I have always treated my customers fairly, so is it fair for me to charge all of my customers 13% in case they pay with credit card (most pay with cash or check) in case they pay with a credit card, or simply charge the ones that do pay with a credit card?

I just paid for a roof on a 4 plex and got a 10% discount by paying cash over check or credit card.

People can't erroneously dispute their purchase after the fact if they paid cash. If someone disputes their purchase with a credit card, they pull the cash from the merchant and hold it for 60 days until they do their investigation. If someone pays with a stolen credit card the merchant also loses that money. There's more risk to taking credit cards than consumers assume. Plus you're giving 3% to the bank. At the same token the consumer gets 1-4% cash back on the transaction from the credit card company, and they get the protection of being able to dispute the charge if things go sideways.

This message has been edited. Last edited by: jimmy123x,

I always ask for a cash discount on significant purchases. Usually an instant 3% savings, which can be a lot on a new furnace etc.

The banks don't need 3% of every transaction that happens every day.

I can see the desire for small businesses w/ low margins to pass on the fee to the customer. I don't argue w/ that. Again, academically, it this the best thing in general? It's probably to complex to generalize I'm guessing now.

Macro/Micro-eco trends, inflation rates, employment rates, velocity of money, real COL, price sensitivity, price elasticity of an industry, etc.

In any case, I'll be watching for prices for rewards vs non-rewards vs cash moving forward. Hopefully there won't be too much difference (probably won't care for small ticket items).

quote:

Originally posted by Bluecobra:
Ahhh, no. When the clerk entered 205.50 it showed that she owed me 194.95. As long as she does not do that but just gives me the 10, she is in balance. The register just needs 10.55 to be in balance and I paid that.

Only if you're a Mom and Pop store that doesn't keep data to that degree. In reality you would be correct, but according to the store records that cashier kept $194.95 and could be terminated for theft unless the transaction is voided and re-rung properly.

One other problem for businesses that accept credit cards - fraud. Being a member of a forum for FFL’s, I see how scammers use stolen cards to purchase things online. The business ends up having to eat the loss, credit cards companies will almost always take the side of the care holder. Buyers will actually receive the items ordered then do a charge back and have the item and their money. Eve with proof the item was delivered the CC companies allow the charge back.

I do not like taking CC’s but you will lose business by not taking them and it is a necessary evil for online sales. Most people are over their heads in debt and can only afford to buy on credit cards. There is a large difference in listings on Gunbroker when I do not accept CC payment, it gets much less traffic and bids.

quote:

Originally posted by ElToro:
Seems like only last decade or so have I really seen 2 prices and in the last 1-2 years it’s everywhere. Restaurants especially. Even my local gun store has a sign that says we add 3% for credit card.

As long as it’s fully disclosed up front. It’s the find out at end that grinds my gears.

This.
As long as it's fully disclosed up front you can be an informed consumer. Sometimes the convenience is worth it, sometimes not.

Informed consent is good.

Philosophically, perhaps the burden of the fee should be w/ the customer. If the customer wants to buy something on credit, whether for convenience in lieu of cash or because of cash flow, then the customer should pay for the credit. Fee upfront and of course any interest accrued on balances.

The varied prices forthcoming because of different card types (reward vs non-reward) is part of the new complexity.

I guess this is my end takeaway.

We consumers are always paying the fee, whether disclosed to us or not.

All merchants assume everyone will pay with plastic, so they automatically raise their prices to cover it. Those that don't build it in but post notice of the added fee for credit are rare, and perhaps have a particular motivation.

Probably so. It's just that, perhaps I'm not paying attention, I don't see different prices for CC and cash when I shop around here. Gas, supermarket, restaurants, etc. So it's curious that the anticipation will be more explicit CC prices (and those will vary by card type) vs cash prices.

Maybe the end result will be that businesses will build in prices reflective of the most expensive card type. That will be the one size fits all price - cash customers are just additional icing.