# credit/debit minimum purchase, legal? **URL:** \ **Category:** Factual Questions\ **Created:** [June 17, 2010, 7:34pm UTC](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588 "2010-06-17T19:34:50Z")\ **Posts on this page:** 20\ **Page:** 2
**Author:** ![Faelyn](https://avatars.discourse-cdn.com/v4/letter/f/c77e96/32.png) [@Faelyn](https://boards.straightdope.com/u/Faelyn)\ **Post date:** [June 18, 2010, 6:07pm UTC](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588/21 "2010-06-18T18:07:11Z")
> [@aceplace57](#): > > Sorry, but I can’t imagine buying one coke with a credit card. Or writing a $1.25 check. > > There’s a reason people carry money in their pocket. I make a point to never carry cash. If someone takes my cash, I’m SOL, if someone takes my debit card, I’m insured. ---
**Author:** ![Skald\_the\_Rhymer](https://avatars.discourse-cdn.com/v4/letter/s/ecccb3/32.png) [@Skald\_the\_Rhymer](https://boards.straightdope.com/u/Skald_the_Rhymer)\ **Post date:** [June 18, 2010, 6:15pm UTC](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588/22 "2010-06-18T18:15:54Z")
> [@kayaker](#): > > When a merchant chooses to be dickish, there are often workarounds. I once asked a cashier for change for a dollar, proffering the single as I asked. He told me he wouldn’t give change without a purchase. I returned the dollar to my pocket, and searched the store for the chepest item. > > I returned to the cashier with my nickel item. He rang me up. I paid. With a $50.😉 I’m not convinced the dickish person in that story is the cashier. ---
**Author:** ![Gary\_Robson](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/gary_robson/32/3448_2.png) [@Gary\_Robson](https://boards.straightdope.com/u/Gary_Robson)\ **Post date:** [June 18, 2010, 11:00pm UTC](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588/23 "2010-06-18T23:00:15Z")
> [@pulykamell](#): > > There’s nothing wrong with this, so far as I know. You can’t charge a surcharge for using a credit card, but you can offer a discount for using cash. Let me dig up a cite. Again, not all agreements are created equal. Mine says I have to charge the same amount for credit card and cash. No surcharge. No discount. ---
**Author:** ![pulykamell](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/pulykamell/32/3166_2.png) [@pulykamell](https://boards.straightdope.com/u/pulykamell)\ **Post date:** [June 18, 2010, 11:08pm UTC](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588/24 "2010-06-18T23:08:41Z")
[quote=“Gary “Wombat” Robson, post:23, topic:543588”] Again, not all agreements are created equal. Mine says I have to charge the same amount for credit card and cash. No surcharge. No discount. [/QUOTE] Sorry. I should have stated that. I’m just assuming that if gas stations in California (and here in Illinois, too) are blatantly doing this, that they probably have the “standard” agreement cited in my link. Granted, maybe this is not an assumption I should be making. ---
**Author:** ![BorgHunter](https://avatars.discourse-cdn.com/v4/letter/b/7c8e57/32.png) [@BorgHunter](https://boards.straightdope.com/u/BorgHunter)\ **Post date:** [June 18, 2010, 11:26pm UTC](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588/25 "2010-06-18T23:26:01Z")
> [@aceplace57](#): > > Sorry, but I can’t imagine buying one coke with a credit card. Or writing a $1.25 check. > > There’s a reason people carry money in their pocket. I do it all the time. I really only have cash on me for laundry and the very rare occasion I need to buy something from a merchant that does not accept credit cards. Losing forty-six bucks to a mugger will make one awfully circumspect about carrying cash around. ---
**Author:** ![UltraVires](https://avatars.discourse-cdn.com/v4/letter/u/ecccb3/32.png) [@UltraVires](https://boards.straightdope.com/u/UltraVires)\ **Post date:** [June 18, 2010, 11:39pm UTC](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588/26 "2010-06-18T23:39:16Z")
> [@Tastes\_of\_Chocolate](#): > > A slightly different wording of the question: > Do credit card agreements allow a merchant to refuse a sale? > I believe that laws say that a merchant can refuse to do business with you. > (Maybe they don’t like blue shirts that day.) > So why couldn’t a merchant decline to do business because of the size of the credit card purchase. > > I guess what I’m asking is: Even if the merchant agreement states that a merchant can not require a minimum purchase to use a credit card, doesn’t the merchant still have the right to refuse to do business with a potential customer? I don’t believe that size of sale is a protected class. You are correct. There is no law which would violate such a thing at the federal level. However, not all such things are a ripoff. Part of my job takes me to a local campus copy center which makes copies, allows students to print, etc. They charge 10 cents per copy (with tax, this comes to 11 cents). Some students print one copy and want to put that on their debit/credit cards. If they allowed that, then they would run into a 25 cent minimum transaction fee from VISA/MC. 11 fucking cents! I think that in the near future, there will be some kind of deal struck with the merchants that will be well known to consumers. Say 5 or 10 dollars as a minimum for card purchases. People will get in the habit of carrying pocket petty cash for sodas, copies, snacks and whatnot, and know that they can use their cards for other things. Just IMHO, though. ---
**Author:** ![DrDeth](https://avatars.discourse-cdn.com/v4/letter/d/b487fb/32.png) [@DrDeth](https://boards.straightdope.com/u/DrDeth)\ **Post date:** [June 19, 2010, 1:59am UTC](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588/27 "2010-06-19T01:59:00Z")
[quote=“Gary “Wombat” Robson, post:8, topic:543588”] To answer one of your peripheral questions (the “why?” part), credit card companies charge merchants both a per-transaction fee and a percentage (not to mention various monthly charges, but we won’t get into those). Let’s take a typical agreement that calls for $0.20 per transaction plus 3% of the total. If you buy a $100 item, the store pays $3.20 - a paltry 3.2% of the total. If you buy a 75 cent soda, the store pays $0.22 - over 29% of the total. That 29% quite possibly exceeds the profit margin on the soda, so the store is losing money by accepting the credit card.. [/QUOTE] The % almost always varies by the amount of the average sale, so it even gets worse- the $100 sale may only have a 1.5% charge. Note that I have heard that the laws and contract vary for debit vs credit cards, and the OP is asking about a debit card. In CA, one can charge a fee for a debit card purchase, not so for a credit card purchase. I do have sympathy for the small merchant with lots of small sales- OTOH, their mark-up is usually higher. I try to pay cash if I buy under $5. Note that there is also a cost for taking cash: extra time to count it, extra insurance, larger loss if robbed, banks charge a small amount for large cash deposits, and armored car companies are NOT cheap at all. (There are also costs with checks, etc, tanstaafl). Cash is usually thought to run about 1% in extra costs, so in Gary “Wombat” Robson’s example of a $100 purchase, the CC trans might only be a extra 20cents or so. Note some businesses don’t accept cash as they don’t want to be bothered. ---
**Author:** ![alphaboi867](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/alphaboi867/32/3898_2.png) [@alphaboi867](https://boards.straightdope.com/u/alphaboi867)\ **Post date:** [June 19, 2010, 3:18am UTC](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588/28 "2010-06-19T03:18:22Z")
Just open the soda, then the clerk will put your card through. ---
**Author:** ![atomicbadgerrace](https://avatars.discourse-cdn.com/v4/letter/a/8e7dd6/32.png) [@atomicbadgerrace](https://boards.straightdope.com/u/atomicbadgerrace)\ **Post date:** [June 19, 2010, 5:14am UTC](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588/29 "2010-06-19T05:14:11Z")
> [@Joe Frickin Friday](#): > > This. > > It’s against the agreement between the merchant and the CC/debit card company (as is the practice of having different prices for cash and CC purchases), but if Visa/MC enforces it by ending their service to this merchant, then they lose ALL future revenue from this merchant. Not a good deal for them; they will not terminate a lucrative relationship over penny-ante violations. As another poster pointed out, the Consumerist message boards are full of stories from folks who have reported merchants and had the issue resolved. I’ve written to VISA/MC several times and had resolution. When I worked for a large national bank, we were asked to forward all claims of this practice to VISA immediately for review and action. The way they trained us on this, and the way VISA representatives handled our calls, gave me the impression that they were quite serious about it. Ending their service is not the only recourse VISA or MC have. No, they don’t want to lose future revenue from the merchant. BUT, they also know that the merchant doesn’t want to lose all of the future revenue that he/she will by not being able to accept their card. ISTM that a strongly worded “it has come to our attention that you are engaging in practices contrary to the terms of our agreement; fix it immediately or we will be forced to review our contract with you and possibly end our agreement” would put a quick end to minimum charges from any merchant who wants to stay in business. I can’t say for certain that my letters to VISA and MC have been the reason several gas stations around here cut that crap out, but I can say that I feel quite confident that VISA and MC both take any breaches of contract quite seriously. I would encourage anyone to report a merchant requiring a minimum transaction. ---
**Author:** ![Red\_Hoodie](https://avatars.discourse-cdn.com/v4/letter/r/2acd7d/32.png) [@Red\_Hoodie](https://boards.straightdope.com/u/Red_Hoodie)\ **Post date:** [June 19, 2010, 6:27am UTC](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588/30 "2010-06-19T06:27:46Z")
My two cents: There’s a gas station down the street from me which has a tacky, crappy, misspelled sign written on cardboard with a Sharpie, admonishing customers on this very point. Might I add, it’s a pretty tacky, crappy gas station as well…they mostly sell gas, blunts, huge white t-shirts, etc. Their competitor right across the street has no such limits on credit or debit cards - and they also have nice lights, clean floors, plenty of stock on hand, nicer employees, etc. So I tend to think in this instance it’s more of a “grabbing at straws” behavior. It irritates me because it’s all just moneygames…between the business and the credit card company. Why are the fees so high on every single transaction? Can’t they get a bulk rate, or a monthly charge, and stop passing the “screw you” on to the little guy? I guarantee the major CC companies aren’t relying on the transaction charge to stay afloat, not with the way they rip people off with interest rates, late fees, etc…it just feels like another way to take a couple bucks out of someone’s pocket…and I suspect it eventually ends up being the consumers. Then again, I hate money. I mean, I absolutely loathe money, the entire concept of it, and the way it can destroy people through avarice and greed. It causes more problems than it’s worth…but I guess it beats the barter system, somehow… ---
**Author:** ![Hari\_Seldon](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/hari_seldon/32/5173_2.png) [@Hari\_Seldon](https://boards.straightdope.com/u/Hari_Seldon)\ **Post date:** [June 19, 2010, 3:03pm UTC](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588/31 "2010-06-19T15:03:53Z")
This thread has been an eye-opener for me. First, I always carry cash, usually between $50 and $100. I just don’t frequent areas where muggings are common. Actually, I have not heard of any here in Montreal, though they doubtless happen. I don’t use a credit card for any transaction under about $20 or $25, but if I was offered a 3.2% discount, I would go much higher. Or 2.2% if it costs 1% to handle cash. As it is, I get a 1% rebate on my credit card. But the main thing that astonishes me is that people resent being asked to pay case for a dollar purchase. I still remember buying a quarter paperback in 1964 when cards were still new, if that was cash or credit. I could not believe that some people would use a card for a quarter purchase. ---
**Author:** ![Thudlow\_Boink](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/thudlow_boink/32/320_2.png) [@Thudlow\_Boink](https://boards.straightdope.com/u/Thudlow_Boink)\ **Post date:** [June 19, 2010, 4:31pm UTC](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588/32 "2010-06-19T16:31:08Z")
My local paper has an article today (which is not yet available online, so I can’t link to it) about the bill proposed by Sen. Dick Durbin that would change the way interchange fees for debit cards work. The article cites a convenience store CEO who says that, not counting the cost of inventory, “debit card fees are the second highest operating cost for her business, following only labor,” and significantly higher than utilities. Here’s one link I found with information on Durbin’s proposal: [http://www.afponline.org/pub/res/news/ns\_20100610\_pay.html](http://www.afponline.org/pub/res/news/ns_20100610_pay.html) > [@](#): > > The Durbin amendment proposes the following: > > Debit fees must be “reasonable and proportional to the actual cost incurred” by the payment network or issuer for processing the transaction. The Federal Reserve will determine what counts as a “reasonable” fee, but it likely will be lower than the current rates that range from 1.03 percent + $0.15 to 1.90 percent + $0.25 for most merchants. (America has the highest credit and debit Interchange rates in the world.) > > Merchants can offer discounts to customers who pay with cards that carry lower transaction fees. Currently, merchants must accept all cards on the same terms. So, for example, a merchant cannot offer a discount to a customer who pays with a debit card instead of a credit card. The Durbin amendment allows merchants to design incentives for customers who pay with less expensive tender types. So you could see retail and online merchants offering a 1 percent discount to customers who pay with a debit card instead of a credit card - a win-win for consumers and merchants because the effective cost of accepting credit card typically is north of 2 percent. > … > Debit cards do provide guaranteed payment and some other incremental benefits to merchants than checks. However, these benefits are small compared the high cost of accepting these cards – typically 1.03 percent + $0.15 to 1.90 percent + $0.25 for most merchants. ---
**Author:** ![IAmNotSpartacus](https://avatars.discourse-cdn.com/v4/letter/i/cc9497/32.png) [@IAmNotSpartacus](https://boards.straightdope.com/u/IAmNotSpartacus)\ **Post date:** [June 19, 2010, 4:35pm UTC](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588/33 "2010-06-19T16:35:50Z")
It’s worth pointing out that rewards cards typically process at a higher rate than standard cards with no rewards. The same holds true for government purchasing cards. Banks do not pay for these rewards for their customers-- the merchants you use the credit cards with do. ---
**Author:** ![atomicbadgerrace](https://avatars.discourse-cdn.com/v4/letter/a/8e7dd6/32.png) [@atomicbadgerrace](https://boards.straightdope.com/u/atomicbadgerrace)\ **Post date:** [June 19, 2010, 4:57pm UTC](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588/34 "2010-06-19T16:57:33Z")
> [@Red\_Hoodie](#): > > It irritates me because it’s all just moneygames…between the business and the credit card company. Why are the fees so high on every single transaction? Can’t they get a bulk rate, or a monthly charge, and stop passing the “screw you” on to the little guy? I guarantee the major CC companies aren’t relying on the transaction charge to stay afloat, not with the way they rip people off with interest rates, late fees, etc…it just feels like another way to take a couple bucks out of someone’s pocket…and I suspect it eventually ends up being the consumers. Time out. You’re confusing “banks” with the “card issuer.” Chase is a bank; VISA is a card issuer. Chase sets (and collects) your interest rate; VISA sets (and collects) the merchant transaction fees. Banks rely on interest and fees to stay afloat. Card issuers rely on transaction costs for a bulk of their income. ---
**Author:** ![IAmNotSpartacus](https://avatars.discourse-cdn.com/v4/letter/i/cc9497/32.png) [@IAmNotSpartacus](https://boards.straightdope.com/u/IAmNotSpartacus)\ **Post date:** [June 19, 2010, 5:02pm UTC](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588/35 "2010-06-19T17:02:35Z")
> [@atomicbadgerrace](#): > > Time out. You’re confusing “banks” with the “card issuer.” Chase is a bank; VISA is a card issuer. Chase sets (and collects) your interest rate; VISA sets (and collects) the merchant transaction fees. Not entirely true. The processing bank (merchant bank), the issuing bank (Chase), and the issuer (Visa) all take a piece of the pie. ---
**Author:** ![mhendo](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/mhendo/32/3159_2.png) [@mhendo](https://boards.straightdope.com/u/mhendo)\ **Post date:** [June 19, 2010, 5:12pm UTC](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588/36 "2010-06-19T17:12:20Z")
> [@Markxxx](#): > > Widget sells for: $1.00 > > Profit: 50¢ > Rent: 10¢ > Shrinkage: 5¢ > Utilities: 10¢ > Taxes: 10¢ > Salaries 6¢ > Benifts for employees 4¢ > Fees for credit cards 3¢ > Goodwill 1¢ > Misc 1¢ > > So if a retailler was allowed to charge the cost of the associated fee on an item he’d be DOUBLE DIPPING. Why? Because the cost of those credit card fees are already IN the item as it’s priced. Of course, what your brilliant and surely completely accurate breakdown misses is something that has already been raised: the fact that credit card fees include not just a percentage, but usually a flat transaction rate. **Gary “Wombat” Robson** gives a figure of 20c which, as he points out, isn’t a problem on a $20 or a $100 transaction, but completely obliterates all the profit and even leaves the merchant with a loss on a $1.00 can of soda. I’ve always been conflicted about merchants who set minimum purchase limits. On the one hand, i get annoyed at not being able to make small purchases with my credit card, or at being asked to buy more stuff just to use the card. And i know it’s true to say that, if the merchant didn’t want to live with the card fees, they should just not take the card. But i also recognize that taking credit cards is essential, and that they would lose too much business if they didn’t take them. And i’m not terribly interested in asserting my Rights As A Consumer, and acting like a douchebag in the process, just to ensure that some small business owner bends over for the credit card companies. ---
**Author:** ![atomicbadgerrace](https://avatars.discourse-cdn.com/v4/letter/a/8e7dd6/32.png) [@atomicbadgerrace](https://boards.straightdope.com/u/atomicbadgerrace)\ **Post date:** [June 19, 2010, 5:18pm UTC](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588/37 "2010-06-19T17:18:31Z")
> [@IAmNotSpartacus](#): > > Not entirely true. The processing bank (merchant bank), the issuing bank (Chase), and the issuer (Visa) all take a piece of the pie. Depends on which pie you’re talking about, and though it’s much more detailed than I described, I think it’s worth noting to the person who suggested that these fees are nickel and diming merchants and consumers that these fees are coming from (and going to) more than one entity. ---
**Author:** ![DrDeth](https://avatars.discourse-cdn.com/v4/letter/d/b487fb/32.png) [@DrDeth](https://boards.straightdope.com/u/DrDeth)\ **Post date:** [June 19, 2010, 5:28pm UTC](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588/38 "2010-06-19T17:28:52Z")
> [@mhendo](#): > > Of course, what your brilliant and surely completely accurate breakdown misses is something that has already been raised: the fact that credit card fees include not just a percentage, but usually a flat transaction rate. **Gary “Wombat” Robson** gives a figure of 20c which, as he points out, isn’t a problem on a $20 or a $100 transaction, but completely obliterates all the profit and even leaves the merchant with a loss on a $1.00 can of soda.. Well, if you buy that can at .25 and sell at $1, no, it doesn’t. And, yes there are other overhead costs but almost none are on a per unit basis. ---
**Author:** ![IAmNotSpartacus](https://avatars.discourse-cdn.com/v4/letter/i/cc9497/32.png) [@IAmNotSpartacus](https://boards.straightdope.com/u/IAmNotSpartacus)\ **Post date:** [June 19, 2010, 5:54pm UTC](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588/39 "2010-06-19T17:54:05Z")
> [@atomicbadgerrace](#): > > Depends on which pie you’re talking about, and though it’s much more detailed than I described, I think it’s worth noting to the person who suggested that these fees are nickel and diming merchants and consumers that these fees are coming from (and going to) more than one entity. I think it’s pretty clear the pie we are talking about here are the charges levied on the merchant for accepting cards, i.e. interchange and discount fees. Your post states clearly that Visa is collecting the interchange fees and implies the issuer (Chase, in your example) only collects interest charges. Chase, Visa, and other parties are getting their mitts on the fees, which is why I pointed it out. While interest charges certainly help the system offset the discount (simple example, compare AmEx’s discount rates with Visa/Mastercard, ~4% to ~2% respectively) it should be made clear that the issuing bank is making some money every single time a customer swipes their card, regardless of whether that charge carries over as a balance subject to interest accrual or not. ---
**Author:** ![picunurse](https://avatars.discourse-cdn.com/v4/letter/p/7bcc69/32.png) [@picunurse](https://boards.straightdope.com/u/picunurse)\ **Post date:** [June 19, 2010, 6:05pm UTC](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588/40 "2010-06-19T18:05:43Z")
The practice of minimum purchases/service fee is rare here… except for the local BP gas stores (ARCO and AM/PM) all credit/debit transactions hold a $0.45 fee. I guess that’s another reason to stop shopping there. [Previous page](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588.md?page=1) [Next page](https://boards.straightdope.com/t/credit-debit-minimum-purchase-legal/543588.md?page=3)