It will be interesting to see if they all do it.

The just had a long discussion about the new rules on our local news...

If you use a credit card there will be a small fee, but there is a way to avoid it..Banks consider a debit card as an E-check, therefore the fee would not apply to debit cards.

They also recommended doing what I have been doing for years. Have a separate account for online purchases and use a debit card against that account. Even if a hacker could get into that account, it never has much of a balance and they cannot get into my primary account because it is with a totally different bank...LOL

Wonder why debit is different. When we took credit cards (until last December), we paid the same discount as for a credit card. And it took the same amount of time to get into our account.

This is interesting.

I've had some smaller mom and pop stores charge a fee for using a credit card. I always assumed they were just passing along the fee the credit card company charges them.

Why do the credit card companies have to "approve" a store adding a fee? Wouldn't it the store's right to pass along a service fee without needing approval?

Anyway, when I read the post topic I thought this was going to be a discussion about charging for plastic grocery bags. LOL!

I understand that the contract that the stores had earlier with the card companies prohibited them from adding such a fee.

I've been told that those contracts also forbade them from allowing discounts for cash purchases.

I've asked for such discounts on occasion, especially after making a purchase immediately following one made on a credit card ...

... and if I recall correctly, haved never scored such a discount.

I've also heard that there's a higher fee charged by the card companies to the merchants when the cash-back cards are used.

I've heard also that the contracts with the card companies require that if a merchant agrees to acdept any of the cards that they issue, they have to accept all of them, including the ones where the higher fees apply.

Card companies have come so close to ruling the roost ...

... that's it's somewhat pleasant to see them being taken down a peg or two.

ole joyful

You should always be careful when using a debtcard for a credit card because it is hooked to all your bank accounts.

But OJ, they won't be down for long! They will indeed figure out a way to keep those huge profits, meaning they will probably allow the merchants to charge us an extra fee at the point of sale.

It always seemed to me that a credit card should be a better option for a merchant. No one has to physically count and roll/bundle the cash, less chance for sticky fingers, etc., etc. I once heard that after the airlines started REQUIRING online drinks to be charged, their revenue went up considerably even though the inventory was the same. I seldom use the debit feature of my bank card unless at the grocery store or somethng. I've always heard the same protections are not there, but I'm not sure what exactly that entails. I once had PayPal fraudulently remove money from my bank account and I never wanna be in that situation again. Took nearly three weeks to get it back. In years past....thankfully LONG past...that could have been disastrous!

Hm, OJ--you've never gotten a cash discount? My mechanic routinely gives a significant discount for paying with cash, and EVERYONE I know who goes there makes a serious effort to pay in cash, even those who use their plastic for everything else (why throw money away, right?)

Really don't see this affecting us too much--we only use our cc to buy our mail order meds and occasionally order something online. Other than that, we pay cash. I've always felt using one's credit card to buy from local mom and pop stores wasn't a nice thing to do to them, since they then had to pay the bank's discount fee on your purchase.

Would be nice if this new ruling meant that prices would be going down (since they're currently designed to COVER that discount)--but I know that's like wishing to win the lottery.....

I use a cc for anything over $15. If it gets to be to costly I will start writing checks again. I don't understand why a store would complain about paying a small fee versus a check. They check the CC immediately and know if it is good or bad, not sure they can do that with checks. I would think it would cost them more handling checks and collecting bad checks.

I believe that there are around 10 states including California and New York that prohibit stores charging the consumer for the use of a credit card. I read that in this case state law will prevail being that this is an agreement between the card companies and the retailers, not a new federal law, so state laws are left intact.

Just Googled. The 10 states are:

California
Colorado
Connecticut
Florida
Kansas
Maine
Massachusetts
New York
Oklahoma
Texas

So if you live or do commerce in them the new surcharge agreement does not effect you.

Oh, cool, Oklahoma is on that list. Not that I worried... cause I can always go back to using cash. :)

Moni

We have one gas station here that gives 5c off for each gallon of gas. Last time I filled up, I saved 75c. Another one gives 3c off.

does that mean if you live in one of the ten states and order online from a company that is not one of the ten, they can't add the fee?

Our agreements with MasterCard/Visa said we weren't allowed to charge more for accepting credit cards. They will have to change that now, I guess. And also not allowed to discount for NOT using them.
I doubt that anyone would lower their prices. That would be like a temporary tax...just doesn't happen.

Public paranoia caused us to have to start taking CC's for guests renting our vacation condo -- after guests being perfectly happy to pay by check for 10 years.

It's not an insignificant expense for us. There's a 3.5% flat fee for a US card and a 4.5% flat fee on a non-US account. Then there are three more fees per transaction. (If I understood them all, I'd explain them to you!) We have to collect State of Hawaii and County or Maui rental taxes (13.42%), so we are paying CC expenses on the whole shebang: rental rate and taxes collected.

Very few, if any, stores deal with the credit card companies directly. It goes through a processing center who handles the transactions.

Credit cards are good for business. You don't have to worry about counterfeit bills. You don't don't get hit with a $40 or $50 bad check fee plus the loss of the check amount on a bad check. You don't have armored car fees. You don't have to collect bad checks. You don't have to go to the bank for change nor do you have to carry so much cash that you're risking robbery. You don't have errors in making change. They make prepaid gas much easier and with prepaid, you eliminate drive-offs. And they've made "travelers checks" obsolete to say nothing of the impulse sales and upsales. For a business, credit cards are a boon. The problem is that fees vary.

Joan is right. Every business I've seen gets charged the same for debit cards, as you would expect they would. Debit cards are handled through the processing center with all the other charges. PCs love debit cards because they get their money quicker. The vendor does not get paid any quicker from a debit card than they do on a credit card and that's months usually.

"Banks consider a debit card as an E-check, therefore the fee would not apply to debit cards." Hmmm. I haven't looked into this so is this part of the legislation or just speculation by the talking heads?