Merchants and card surcharges - are they allowed? Has it changed how you spend?

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dukeblue219
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by dukeblue219 »

There are so many ways to get 2.5% or more back on credit cards that I don't care at all if there is a surcharge. Saw it this morning at a new brunch place in DC suburbs - 1.5% charge for CC. It's different, but I understand why it exists.
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leeks
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by leeks »

I encounter this many places now: doctor, dermatologist, dentist, pediatric occupational therapist, car repair place, private school tuition payments, kids sports programs, summer sleepaway camp, etc.

It is not feasible to opt out of all businesses that do this.
advice789
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by advice789 »

Am also seeing more places with the surcharge. Last year, the renovation store charged a 3% adder for new counters, with $5k+ invoice. Also learned a debit card payment is exempt from the fee.
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SmileyFace
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by SmileyFace »

leeks wrote: Sun Jul 07, 2024 8:11 pm I encounter this many places now: doctor, dermatologist, dentist, pediatric occupational therapist, car repair place, private school tuition payments, kids sports programs, summer sleepaway camp, etc.

It is not feasible to opt out of all businesses that do this.
I have yet to see it anywhere - but perhaps because I live in a state where it is prohibited.
I drove to another city with parking meters recently- had quarters in a container in my car from a long time ago but the parking meters there only take credit cards.

I hope we don't have to go back to dealing with cash and lothesome coins again. Nightmares of stopping at highway toolbooths and throwing in coins comes to mind. Dirty change in pockets falling out when sitting back in a chair and so on. Seems so antiquated now.

So jopefully we don't go back to the dark ages with paper and metal money. Hopefully things work themselves out with lower transaction fees to merchants or similar. Even carrying credit cards has become unnecessary much of the time with Apple Pay and Google Pay - but people in this thread talking about paper and coins? Maybe we should go back to shells and beads.
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bd7
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by bd7 »

leeks wrote: Sun Jul 07, 2024 8:11 pm I encounter this many places now: doctor, dermatologist, dentist, pediatric occupational therapist, car repair place, private school tuition payments, kids sports programs, summer sleepaway camp, etc.

It is not feasible to opt out of all businesses that do this.
I find it interesting that we all have such different experiences, presumably based on location. In our case with the exception of two old oddballs, all doctors/dentists/hospitals/physical therapists take CC without surcharge. Our insurance company (USAA), local municipal utilities (water/trash) and electric company (SCE) all take AMEX without complaint. Restaurants, secondhand thrift stores, local butcher shops and ethnic groceries are all the same. Just now we went to a taco stand that we've driven by but never tried, they took AMEX without batting an eye. There was a small sign on the window that read ".50 DEBIT/CREDIT FREE". That struck me as a little odd.
scrabbler1
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by scrabbler1 »

When I accumulate too many coins, I make a trip to the self-checkout lane of the supermarket to make my food purchase (I usually don't buy so many items as to bar myself from using one.) Once there, I can deposit all my unwanted, excess coins as the first part of my payment. I can pay the rest either with bills or still use my CC. No matter what, I have rid myself of all the excess coins.
upwind
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by upwind »

leeks wrote: Sun Jul 07, 2024 8:11 pm

I hope we don't have to go back to dealing with cash and lothesome coins again. Nightmares of stopping at highway toolbooths and throwing in coins comes to mind.
This is how I used to get rid of all my pennies. Would count them out and put them in old film canisters and then when traveling to state with toll roads would dump them in the automatic toll machines and let them deal with it. It was oddly satisfying.
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telemark
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by telemark »

scrabbler1 wrote: Sun Jul 07, 2024 9:17 pm When I accumulate too many coins, I make a trip to the self-checkout lane of the supermarket to make my food purchase (I usually don't buy so many items as to bar myself from using one.) Once there, I can deposit all my unwanted, excess coins as the first part of my payment. I can pay the rest either with bills or still use my CC. No matter what, I have rid myself of all the excess coins.
This is what I do also, except that I separate out the quarters for use in my building's laundry room. The stores are happy to get the coins, it saves them from having to order them from a bank.
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by scrabbler1 »

telemark wrote: Sun Jul 07, 2024 10:36 pm
scrabbler1 wrote: Sun Jul 07, 2024 9:17 pm When I accumulate too many coins, I make a trip to the self-checkout lane of the supermarket to make my food purchase (I usually don't buy so many items as to bar myself from using one.) Once there, I can deposit all my unwanted, excess coins as the first part of my payment. I can pay the rest either with bills or still use my CC. No matter what, I have rid myself of all the excess coins.
This is what I do also, except that I separate out the quarters for use in my building's laundry room. The stores are happy to get the coins, it saves them from having to order them from a bank.
I also hold back some of the quarters because I save them sometimes for parking meters and some coin-operated vending machines (and for my ladyfriend's laundry machines; mine use a special, prepaid debit card). At the supermarket, though, their self-checkout machines are erratic and sometimes don't take cash from one day to the next.
UpperNwGuy
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by UpperNwGuy »

muffins14 wrote: Sat Jul 06, 2024 9:13 pm In effect, a cash discount is the same thing as a card surcharge.

Would you rather have
1) all prices are 3% higher and zero extra fee for card, no discount for cash
2) all prices flat, but have a 3% fee for using a card
3) all prices 3% higher but you get a 3% discount for cash
I would rather have
1) all prices are 3% higher and zero extra fee for card, no discount for cash

I don't carry cash, nor do I carry a debit card.
bberris
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by bberris »

Some restaurants here are adding 3-6 % no matter how you pay, for "employee health".
When you think credit card fees are high for the merchant, remember that cash has a cost, too. It has to be insured, counted, transported, and there are losses and risks that credit payments don't have.
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by muffins14 »

bberris wrote: Mon Jul 08, 2024 5:05 am Some restaurants here are adding 3-6 % no matter how you pay, for "employee health".
When you think credit card fees are high for the merchant, remember that cash has a cost, too. It has to be insured, counted, transported, and there are losses and risks that credit payments don't have.
I really don’t get the point of that. Why don’t they just raise prices by 3-6%? Do they want us to be mad and pressure lawmakers for healthcare benefits for workers or something?
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NYCaviator
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by NYCaviator »

muffins14 wrote: Mon Jul 08, 2024 7:16 am
bberris wrote: Mon Jul 08, 2024 5:05 am Some restaurants here are adding 3-6 % no matter how you pay, for "employee health".
When you think credit card fees are high for the merchant, remember that cash has a cost, too. It has to be insured, counted, transported, and there are losses and risks that credit payments don't have.
I really don’t get the point of that. Why don’t they just raise prices by 3-6%? Do they want us to be mad and pressure lawmakers for healthcare benefits for workers or something?
That’s the problem with these junk fees. Most people only look at the price on the menu (where they conveniently exclude mention of these fees) and then just glance at the receipt. Most people wont notice it and just pay the bill. So the restaurants prices look the same but they’ve really tacked on an extra 3% to the price.
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by PersonalFinanceJam »

NYCaviator wrote: Mon Jul 08, 2024 7:43 am
muffins14 wrote: Mon Jul 08, 2024 7:16 am
bberris wrote: Mon Jul 08, 2024 5:05 am Some restaurants here are adding 3-6 % no matter how you pay, for "employee health".
When you think credit card fees are high for the merchant, remember that cash has a cost, too. It has to be insured, counted, transported, and there are losses and risks that credit payments don't have.
I really don’t get the point of that. Why don’t they just raise prices by 3-6%? Do they want us to be mad and pressure lawmakers for healthcare benefits for workers or something?
That’s the problem with these junk fees. Most people only look at the price on the menu (where they conveniently exclude mention of these fees) and then just glance at the receipt. Most people wont notice it and just pay the bill. So the restaurants prices look the same but they’ve really tacked on an extra 3% to the price.
It's out of control along with the request for tips everywhere. Was recently traveling and stopped in a little tourist spot. Paid to park at a public lot with one of those pay by plate systems. The advertised price was $8/hour, upon paying there was an additional $1.25 service charge added by the company running the system. There was 0 other ways to park and pay. You could see where there had once been an attendant stand that was long since removed. Would like to see something like I hear other countries have where all taxes and fees are included in the advertised price.

My parents run a small business which started accepting credit cards in the last few years. Before that it was strictly cash or check. They haven't had a huge problem but they have had cash stolen by employees and the occasional bounced check. When they finally succumbed to taking cards they added a processing fee for card users. They also complain about the inconvenience and time wasted going to the credit union for deposits and manually collecting and remitting sales taxes. :oops:
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by lazynovice »

leeks wrote: Sun Jul 07, 2024 8:11 pm I encounter this many places now: doctor, dermatologist, dentist, pediatric occupational therapist, car repair place, private school tuition payments, kids sports programs, summer sleepaway camp, etc.

It is not feasible to opt out of all businesses that do this.
Those places will accept a check though. Restaurants won’t and fewer and fewer and fewer retail places will.
rockstar
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by rockstar »

I go to Costco for gas whenever I can to avoid the credit up charge at gas stations. This didn’t help me when I road trip. But it does help me most of the time. The up charge would add up over the year.
tim1999
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by tim1999 »

I recently started bringing more cash with me when going to certain restaurants and golf courses I like, because they are now charging 3-4% credit card surcharges. These surcharges are in excess of the cash back I receive for using the card, so it makes more sense to pay cash.

The particular golf course gives zero advance warning about the surcharge until you go to pay, tell them you are using a card, and the amount on the POS terminal is higher than what the rate + tax would be. The first time it happened I had them cancel out the transaction and start over so I could pay cash instead. The restaurants either have it in fine print on the menu or you don't find out until you get the check and see it as a line item, even if you haven't told them your method of payment yet.
exodusNH
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by exodusNH »

LotsaGray wrote: Sun Jul 07, 2024 5:31 pm 2. People like to claim dealing with cash is expensive but generally when asked to identify those cost specifically attributed to solely dealing with cash, these cost claims become very generic. So what are these specific and identifiable cost that are unique to cash transactions?
The costs are hard to tabulate, but some of them:

Slower checkout process
The need to balance the till at the end of the night
The need to move cash to/from the vault and the till
Running out of change because atms often dispense only $20 bills
Sending people to/from the bank, possibly at night
Loss of sales because people may not have enough cash on hand
Shortage issues
Counterfeit issues (though perhaps less likely than credit card fraud)

I'm not saying it's 3%, but you can't put a hard number on some of the risks. Send an employee to the bank at 10 pm for a night deposit or keep the cash at the location overnight and risk robbery or theft?
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by Normchad »

exodusNH wrote: Mon Jul 08, 2024 4:14 pm
LotsaGray wrote: Sun Jul 07, 2024 5:31 pm 2. People like to claim dealing with cash is expensive but generally when asked to identify those cost specifically attributed to solely dealing with cash, these cost claims become very generic. So what are these specific and identifiable cost that are unique to cash transactions?
The costs are hard to tabulate, but some of them:

Slower checkout process
The need to balance the till at the end of the night
The need to move cash to/from the vault and the till
Running out of change because atms often dispense only $20 bills
Sending people to/from the bank, possibly at night
Loss of sales because people may not have enough cash on hand
Shortage issues
Counterfeit issues (though perhaps less likely than credit card fraud)

I'm not saying it's 3%, but you can't put a hard number on some of the risks. Send an employee to the bank at 10 pm for a night deposit or keep the cash at the location overnight and risk robbery or theft?
Lots of that “cash” avoids the tax system, so that offsets a lot of that…. Honestly, employee theft is the biggest issue with cash. That’s why they have the “if you didn’t get a receipt, your meal is free! Call this number” signs……
jtdavid
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by jtdavid »

Don't forget all these business owners that are charging CC surcharges are paying as many of their bills as possible with their own 2% cash back credit card...
upwind
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by upwind »

:?:
exodusNH wrote: Mon Jul 08, 2024 4:14 pm
LotsaGray wrote: Sun Jul 07, 2024 5:31 pm 2. People like to claim dealing with cash is expensive but generally when asked to identify those cost specifically attributed to solely dealing with cash, these cost claims become very generic. So what are these specific and identifiable cost that are unique to cash transactions?
The costs are hard to tabulate, but some of them:

Slower checkout process
The need to balance the till at the end of the night
The need to move cash to/from the vault and the till
Running out of change because atms often dispense only $20 bills
Sending people to/from the bank, possibly at night
Loss of sales because people may not have enough cash on hand
Shortage issues
Counterfeit issues (though perhaps less likely than credit card fraud)

I'm not saying it's 3%, but you can't put a hard number on some of the risks. Send an employee to the bank at 10 pm for a night deposit or keep the cash at the location overnight and risk robbery or theft?
Don’t forget armored cash trucks. You see very few of those now but wasn’t unusual to routinely see those in front of large discount and department stores and what have you even in the middle of the business day.

Then you have problems even with the “professionals” in cash handling.

https://projects.tampabay.com/projects/ ... ld/vaults/
Last edited by upwind on Mon Jul 08, 2024 6:32 pm, edited 1 time in total.
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piper
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by piper »

PNWpilot wrote: Sat Jul 06, 2024 8:56 pm 1) yes, card surcharges have been on the rise IME since 2021.

2) Businesses that implement these surcharges don’t care about their individual customer. These businesses are typically: touristy restaurants and gift shops that don’t have repeat customers.

3) If I encounter a card surcharge, I will avoid doing business if possible. Then, I never return.
If they charged 3% more without you knowing and and then gave a 3% discount for cash would that make you look at it different?
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by NYCaviator »

piper wrote: Mon Jul 08, 2024 6:11 pm
PNWpilot wrote: Sat Jul 06, 2024 8:56 pm 1) yes, card surcharges have been on the rise IME since 2021.

2) Businesses that implement these surcharges don’t care about their individual customer. These businesses are typically: touristy restaurants and gift shops that don’t have repeat customers.

3) If I encounter a card surcharge, I will avoid doing business if possible. Then, I never return.
If they charged 3% more without you knowing and and then gave a 3% discount for cash would that make you look at it different?
That would still bug me, personally. The price should be the same, regardless of how you pay. If that means increasing all prices 1.5% to even it out (since interchange fees are not all the same and some people pay debit/cash), fine. But interchange fees are a cost of doing business, so don't pass it along to the consumer if you, as a business, want the convenience and benefits of accepting cards.

It just creates this lose-lose system where merchants impose surcharges so consumers switch to higher rewards cards so banks impose higher interchange fees and so on and so forth. Ultimately, I just wish they'd do away with credit card rewards. Give me a low or no annual fee charge card that has some travel insurance and purchase protection and I'd be a happy camper.
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by lazynovice »

We don’t have many restaurants or retail places around us with us with the surcharge. We had an upscale restaurant (by our local standards) that had one. Meals there with (food, wine, dessert) run about $100-$150 a person. We went one time and paid the surcharge. Decided we weren’t going to go back. This wasn’t a thin margin place. We must not have been the only ones because that practice stopped shortly thereafter.

Hair stylists and housekeeper take Zelle. Nail salon will take a card for the service but not the tip. I take cash for the tip.

Many of our standard bills have always charged a fee and we pay those out of checking via a direct debit or bill pay.
alexbogle
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by alexbogle »

I used cash the other day because I saw a 2% surcharge. I would have gotten back 2.65% but had the cash so figured why not.

I regretted it after when I got 90 cents in change that I now had to carry around. AND a dime was missing.

Inconsequential but I had a chuckle.

Next time I'll take the credit card redemption.


However for recurring local charges I do try to pay with cash. For example, my barber that took me two years to find. I like giving him an extra bonus by avoiding the CC fees.
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wwhan
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by wwhan »

I have not run into this at a store, but it has occcured for; Paying the DMV, Property tax, Contractors & Utilities.

If they charge a CC surcharge, I generally pay by cash or check.
HoloceneExtinction
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by HoloceneExtinction »

muffins14 wrote: Sat Jul 06, 2024 9:13 pm In effect, a cash discount is the same thing as a card surcharge.

Would you rather have
1) all prices are 3% higher and zero extra fee for card, no discount for cash
2) all prices flat, but have a 3% fee for using a card
3) all prices 3% higher but you get a 3% discount for cash
Option 4: the store where I pay the least
zie
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by zie »

toddthebod wrote: Sun Jul 07, 2024 7:36 am Ironically it actually costs many businesses more to handle cash than to take credit cards.
For example, data compiled by Brink’s shows that on average, businesses that take in low volumes of cash ($10,000 a month or lower) and don’t use a cash pickup service spends nearly 6% of their monthly cash intake on costs of managing and handling cash. For businesses with medium volumes of cash ($20,000 a month), that number is 3.09%, and for businesses with high cash volumes of cash, ($30,000 a month) it’s 3.26%
https://us.brinks.com/-/the-true-costs- ... management
This is really interesting. I agree handling cash is annoying. When I ran my business, the local SBA sponsored SBDC would silently endorse us to take a 10-15% skim off the cash coming in and never report that to the IRS. I mean it was openly talked about with all new business owners coming in from everyone who actually ran businesses. I doubt it's changed much, though perhaps the SBA no longer silently endorses such a tactic anymore, I have no idea. That would easily make back the cash handling fees. Perhaps that was just local to my community as well I don't know, but it wouldn't surprise me at all if many/most small single owner businesses did something like this.
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zie
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by zie »

zie wrote: Mon Jul 08, 2024 8:53 pm
toddthebod wrote: Sun Jul 07, 2024 7:36 am Ironically it actually costs many businesses more to handle cash than to take credit cards.
For example, data compiled by Brink’s shows that on average, businesses that take in low volumes of cash ($10,000 a month or lower) and don’t use a cash pickup service spends nearly 6% of their monthly cash intake on costs of managing and handling cash. For businesses with medium volumes of cash ($20,000 a month), that number is 3.09%, and for businesses with high cash volumes of cash, ($30,000 a month) it’s 3.26%
https://us.brinks.com/-/the-true-costs- ... management
This is really interesting. I agree handling cash is annoying. When I ran my business, the local SBA sponsored SBDC would silently endorse us to take a 10-15% skim off the cash coming in and never report that to the IRS. I mean it was openly talked about with all new business owners coming in from everyone who actually ran businesses. I doubt it's changed much, though perhaps the SBA no longer silently endorses such a tactic anymore, I have no idea. That would easily make back the cash handling fees. Perhaps that was just local to my community as well I don't know, but it wouldn't surprise me at all if many/most small single owner businesses did something like this.


As for the OP's question, I don't really pay attention at all and still pay CC whenever possible, it's just easier for me. I'm past the point of caring about an extra 3% here or there. If it was very regular, I might change my habits, but I only see it rarely right now(either a discount for cash or a small 2-3% fee for CC charge). The convenience of using Apple Pay is worth something, but probably not a consistent fee after rewards.
Whether rich or poor, a young woman should know how a bank account works, understand the composition of mortgages and bonds, and know the value of interest and how it accumulates. -Hetty Green
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by whodidntante »

Yes, it's generally allowed. You can vote with your feet, but that can be tiring.

The fee horse has been beaten solidly. It is fees, but it's not just fees.

A lot of businesses, even large ones, don't have enough cash to operate and are dependent on debt and money movement to stay in business. Accepting a credit card adds an additional delay until the funds are in their bank account, and makes their cash flow a little bit worse. A credit card dispute can delay things even further, particularly if it was for big ticket items like groceries.

Meanwhile the business has employees, landlords, governments, and vendors who expect to get paid on time. Paying taxes with a credit card seems like an obvious solution, but we can't all be Bogleheads.
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by GreenGrowTheDollars »

PNWpilot wrote: Sat Jul 06, 2024 8:56 pm 1) yes, card surcharges have been on the rise IME since 2021.

2) Businesses that implement these surcharges don’t care about their individual customer. These businesses are typically: touristy restaurants and gift shops that don’t have repeat customers.

3) If I encounter a card surcharge, I will avoid doing business if possible. Then, I never return.
Colorado allows merchants to charge up to the actual cost of credit card processing.

My business normally accepted a largish retainer via check. Any subsequent charges are typically paid by credit card, and we absorb those charges.

Over time, more folks requested the option to make the retainer payment via credit card. So, we offer three options for paying the retainer:
- Give us a check (no extra fee)
- Pay via ACH (no extra fee for the client; we pay $10 to our processor for this service
- Pay via credit card and we add 3.2%

We pay more in credit card fees annually than we do for any other category of expenses for our professional services firm. Personally, I wouldn't pay a 3.2% surcharge...but about a quarter of our clients elect that option. I figure that we're giving people a choice, and they make the choice that best fits their circumstances.
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TxFrog
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by TxFrog »

Eh, No.

You can get cash back in the 2% - 3% range with some credit cards. If the difference is <1% (between merchant surcharge and CC cash back reward) it’s not worth using cash to make trips to ATM and deal with change. Also, as another poster mentioned, sometimes when I do use cash, the merchant warns me they don’t have much change. Oh Joy! Now I have to carry a mix of 1’s, 5’s, 10’s and 20’s if I want to use cash.
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Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by PNWpilot »

piper wrote: Mon Jul 08, 2024 6:11 pm
PNWpilot wrote: Sat Jul 06, 2024 8:56 pm 1) yes, card surcharges have been on the rise IME since 2021.

2) Businesses that implement these surcharges don’t care about their individual customer. These businesses are typically: touristy restaurants and gift shops that don’t have repeat customers.

3) If I encounter a card surcharge, I will avoid doing business if possible. Then, I never return.
If they charged 3% more without you knowing and and then gave a 3% discount for cash would that make you look at it different?
I would rather have the sticker price reflect all available information and costs. So yes, a 3% increase in sticker price is fine by me because I see it prior to taking it to the register or ordering at a restaurant.

I would also be comfortable with a 3% cash discount.
PNWpilot
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Joined: Fri Sep 17, 2021 12:48 pm

Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by PNWpilot »

NYCaviator wrote: Mon Jul 08, 2024 7:43 am
muffins14 wrote: Mon Jul 08, 2024 7:16 am
bberris wrote: Mon Jul 08, 2024 5:05 am Some restaurants here are adding 3-6 % no matter how you pay, for "employee health".
When you think credit card fees are high for the merchant, remember that cash has a cost, too. It has to be insured, counted, transported, and there are losses and risks that credit payments don't have.
I really don’t get the point of that. Why don’t they just raise prices by 3-6%? Do they want us to be mad and pressure lawmakers for healthcare benefits for workers or something?
That’s the problem with these junk fees. Most people only look at the price on the menu (where they conveniently exclude mention of these fees) and then just glance at the receipt. Most people wont notice it and just pay the bill. So the restaurants prices look the same but they’ve really tacked on an extra 3% to the price.
Yes, this is what I call surreptitious surcharges. They should be illegal. Much the same as how Ticketmaster got dinged for their junky surcharges.
PNWpilot
Posts: 308
Joined: Fri Sep 17, 2021 12:48 pm

Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by PNWpilot »

LotsaGray wrote: Sun Jul 07, 2024 2:43 pm
PNWpilot wrote: Sun Jul 07, 2024 9:00 am
LotsaGray wrote: Sat Jul 06, 2024 10:54 pm
PNWpilot wrote: Sat Jul 06, 2024 8:56 pm 1) yes, card surcharges have been on the rise IME since 2021.

2) Businesses that implement these surcharges don’t care about their individual customer. These businesses are typically: touristy restaurants and gift shops that don’t have repeat customers.

3) If I encounter a card surcharge, I will avoid doing business if possible. Then, I never return.
I am the opposite. I will seek them out and gladly pay with cash. It beats having them raise my price to cover your fees.
The business could offer a 3% discount for cash customers. But most don’t.

This isn’t about paying cash, it’s about passing on costs to consumers in a surreptitious manner.
Surreptitious: kept secret

Since ime such a charge is clearly listed it is the exact opposite of surreptitious. It would literally be surreptitious to not discount for cash, not add a surcharge for cards and then not disclose that part of every transaction, cash, charge or other, is going to cover cc clearing charges. One could even potentially make claim that causing a debit card to to pay more is actually not allowed in states where surcharges on debit cards isn’t allowed. (Note I don’t believe such a claim would be upheld, but it could be made. )

Yes a vendor could instead choose to provide a discount for cash. This might make their goods or services appear less competitive. The “list price” would appear higher than competitors who chose to use a surcharge biz model.

I see it the exact opposite. It is the vendor openly passing along a cost caused by specific customer directly to that customer.
Interestingly, I went to a restaurant over the weekend with a relative. I ordered a $25 entree and a $3.50 drink. Those were the prices advertised on the menu.

When the waitress brought me the check, it had two prices: one with cash and the other with a 3% CC surcharge. I asked if the surcharge was listed on the menu, and was told no.

I didn't have cash, so had to pay the surcharge.

I wasn't informed of the surcharge prior to running up a bill. That is surreptitious to me.
rogue_economist
Posts: 347
Joined: Mon Apr 01, 2024 3:52 pm

Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by rogue_economist »

They are allowed, but vary considerably from place to place.

Where I live they are rare as hens teeth, only the liquor store has one that I know of. One grocery chain does not accept credit cards either. But I did some traveling over the holiday and in a different part of the US I was finding them left and right. Of four restaurants I went to, one did not accept cards at all, and two had surcharges in excess of even my decent 3% cashback on restaurants rate.

I don't differentiate between a surcharge on a card and a discount on cash, two sides of the same coin.

Unfortunately this kind of behavior is allowed and even encouraged by the idea that card surcharges are an expense over cash. This is largely illusory however since cash also has expenses, and by some estimates costs more than credit card interchange.

I would prefer that prices be fixed regardless of payment method.
Society grows great when old men plant trees whose shade they shall never sit in
LotsaGray
Posts: 1601
Joined: Sat Mar 25, 2023 2:08 pm

Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by LotsaGray »

PNWpilot wrote: Tue Jul 09, 2024 10:03 am
LotsaGray wrote: Sun Jul 07, 2024 2:43 pm
PNWpilot wrote: Sun Jul 07, 2024 9:00 am
LotsaGray wrote: Sat Jul 06, 2024 10:54 pm
PNWpilot wrote: Sat Jul 06, 2024 8:56 pm 1) yes, card surcharges have been on the rise IME since 2021.

2) Businesses that implement these surcharges don’t care about their individual customer. These businesses are typically: touristy restaurants and gift shops that don’t have repeat customers.

3) If I encounter a card surcharge, I will avoid doing business if possible. Then, I never return.
I am the opposite. I will seek them out and gladly pay with cash. It beats having them raise my price to cover your fees.
The business could offer a 3% discount for cash customers. But most don’t.

This isn’t about paying cash, it’s about passing on costs to consumers in a surreptitious manner.
Surreptitious: kept secret

Since ime such a charge is clearly listed it is the exact opposite of surreptitious. It would literally be surreptitious to not discount for cash, not add a surcharge for cards and then not disclose that part of every transaction, cash, charge or other, is going to cover cc clearing charges. One could even potentially make claim that causing a debit card to to pay more is actually not allowed in states where surcharges on debit cards isn’t allowed. (Note I don’t believe such a claim would be upheld, but it could be made. )

Yes a vendor could instead choose to provide a discount for cash. This might make their goods or services appear less competitive. The “list price” would appear higher than competitors who chose to use a surcharge biz model.

I see it the exact opposite. It is the vendor openly passing along a cost caused by specific customer directly to that customer.
Interestingly, I went to a restaurant over the weekend with a relative. I ordered a $25 entree and a $3.50 drink. Those were the prices advertised on the menu.

When the waitress brought me the check, it had two prices: one with cash and the other with a 3% CC surcharge. I asked if the surcharge was listed on the menu, and was told no.

I didn't have cash, so had to pay the surcharge.

I wasn't informed of the surcharge prior to running up a bill. That is surreptitious to me.
If the charge was not posted or directly shared with me before ordering, I was strongly protest. Not with the wait staff but with mgr. is it worth it to completely refuse to pay the fee? It depends. I have taken a stand for less before just on principles but not always. But regardless of what a fee is for, it needs to be shared before it is incurred. I have definitely walked away from transactions when terms were changed with a surprise charge a check out.
Pu239
Posts: 603
Joined: Mon Dec 17, 2018 5:24 pm

Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by Pu239 »

MtnTravel wrote: Sun Jul 07, 2024 5:05 pm
At least in Colorado where debit card surcharges are allowed, there's no other option for payments. It's either pay the surcharge or deal with cash.
If you're paying debit card surcharges in Colorado it's illegal according to the Colorado Attorney General's office. See https://coag.gov/app/uploads/2022/06/Co ... harges.pdf

Merchants are now allowed to charge credit card surcharges but only up to a certain maximum and if the correct signage is posted prior to the sale. The signs/notices must meet specific legal requirements. See https://leg.colorado.gov/sites/default/ ... signed.pdf

A few months ago, a local restaurant added a cc surcharge charge to our bill. I asked the server where the sign was and she said they didn't have one. After a brief back and forth regarding the law, she took the charge off the bill. If the business charges a fee and is non-compliant, file a complaint with the CO Attorney General's office. Know your rights Coloradans! Perhaps other states have similar laws and consumer protections.

edit - typo correction
Between the idea And the reality...Between the motion And the act...Falls the Shadow - T. S. Eliot
MnD
Posts: 5334
Joined: Mon Jan 14, 2008 11:41 am

Re: Merchants and card surcharges - are they allowed? Has it changed how you spend?

Post by MnD »

There's a really good small/local alignment and suspension shop I've used for decades.

Last time I used them I had a wheel bearing replaced. Dropped it off and they called me with the estimate for approval which i did.
They didn't mention the new 3% charge for using any type of card when they gave me the estimate.

They also added a line item to the invoice which was 5% of the repair for an extended warranty on the repair they made.
From 12 to 24 months and included a towing benefit if your vehicle broke down due to their specific repair.
I missed that charge when when paying since it was included in my phone estimate total.
The fine print on the invoice said it could be removed at time of payment.

Bottom line I left them a very negative online review and will never use them again.
The owner called me and wanted to talk about my review and I didn't return his call.
70/30 AA for life, Global market cap equity. Rebalance if fixed income <25% or >35%. Weighted ER< .10%. 5% of annual portfolio balance SWR, Proportional (to AA) withdrawals.
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