Oddly enough, one of their customers (the OP) is reacting, and yet you have a problem with it. Does not compute.
I can’t quite explain why, but this whole thread feels like the last page of the last book of the Dark Tower series, for some reason.
You know what- hold the merchants to their agreement. Complain to Visa when they set a minimum purchase price and complain when they charge a fee for credit card payment. But then don’t complain when certain places don’t take Visa (or other credit cards) , when other places raise their prices to account for people using credit cards to pay for a cup of coffee, and especially don’t complain when stores offer a cash discount ( which Visa allows) which differs from the fee in the OP mainly in presentation and size - cash discounts on gas around here are usually about 10 cents a gallon, and I’ve seen 5% cash discounts in a lot of places( stores, catalogs and online). At .10 a cone , the OP would have paid .40 more than a cash customer, and at a 5% discount he would have paid around .67 more than a cash customer. Who is better off with those options? Not the OP.
No but they’re paying for them.
You’re right though that the bonuses aren’t free. Most people have to spend – What? $20,000? $25,000? – to get their ‘free’ airline ticket. And some cards charge an annual fee. (I think this is normal for airline miles. Other bonus programs don’t have annual fees.) And many consumers don’t pay their bills in full every month, so they’re charged interest.
But aside from bonuses, consumers receive a benefit. It’s convenient to pay with plastic. If the card is lost or stolen, they’re out little if any money. Not so if they carry gobs of cash. Consumers agree to the terms of use when they sign up for the card. There is no option to not pay interest on an outstanding loan, or to pay less for goods because they’re going to have to pay interest.
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So a few bucks is now gobs of cash? Essentially merchants are asking are asking the consumer to carry 20 to 40 bucks and help them defray their overhead. The reason it got to this point was because consumers weren’t aware or didn’t care. Now that they are being made aware the response is, “Oh those selfish dishonest bastards” I think that’s a little one sided. If I like a local business I want to support them and I know they have to make money to stay open so I won’t begrudge bending the rules to do that, or asking me to to help out by either carrying a little cash or using my debit rather than credit, or paying and extra 25 cents for ice cream.
btw if your CC is stolen you will probably eventually get all the money back but it can be a huge pain in the ass. The desire for the convenience of credit cards has led to the problem of identity theft.
As I’ve said before. I agree from a strict ethical sense but not from a practical sense. The CC companies are not enforcing that detail. You are free not to use your cards in righteous outrage over this or accept the reality of the situation that convienience costs money and carry 40 bucks in cash for small transactions to help out your local merchant.
Sure, I do Ebay as well but it is not my livelihood so if I don’t make as much as I hoped I don’t have to close up shop.
Honest I understand the gut reaction of consumers but I think this outrage over the violation of the merchant agreement is a smokescreen for a bit of pettiness. If it wasn’t customers would be equally outraged by the CC companies lack of enforvement and refuse to do business with them as well.
Out of sincere curiosity how many people who think the merchant is being a dishonest prick would feel better if the merchant simply raised all his prices a bit and them offered a small discount for cash. I’d have to agree that would be technically more honest and in keeping with the agreement.
Seriously, would you feel better if they had a sign that said 5% discount for cash transactions or would you still feel violated and cheated somehow because you didn’t carry cash? Isn’t the “Why should I pay extra because I don’t have cash feeling about the same”
In the other thread I also suggested a sign that only requested a minimum purchase for CC rather than a strict policy. The problem is that too often the percentage of people that shrug and say, “Not my problem” while paying with a CC will be so high that a friendly request doesn’t help much.
He voiced his opinion and I’m voicing mine. Not a problem. I’m only pointing out that consumer decisions affect the marketplace and convienience costs money. As we change how we purchase small items for the sake of our own convienience the marketplace will react. I’m suggesting a little understanding and compassion for the small business owner who is often a human being we share the neighborhood with. I’m noticing the righteous indignation is a little one sided in these last couple of threads
Seriously,
How would you feel about a small merchant raising his prices and then offering a slight discount for cash payment? Would you see that as netter and more honest?
Perhaps that’s the less offensive way to go precisely because it’s perceived as more honest. Perception has a lot to do with business success or failure.
Perception is a funny thing isn’t it. I’m beginning to think that raising prices slightly on items under ten dollars and offer a cash discount is the way to go.
I remember a friend who owned a grocery store telling me he might have canned corn for 23 cents a can and sell X amount. If he put a big stack at the end of an isle and marked it with a big sign that said 4 for a dollar he would sell twice as much. Perception.
There’s an added wrinkle for my store though. Although people don’t compare prices much for small items like ice cream, or say guitar strings and picks, on other purchases they definitely do and raising the prices is not a realistic option.
I’m sincerely curious too, which was why I asked just that question already. 
Yes you did. That’s what prompted me to repeat it in hopes that repetition might prompt more posters to answer. I’d really like to know.
In thinking about it though I think this might only be practical for places whose inventory has a lot more things under ten dollars.
In thinking more about the OP I do have to wonder why and ice cream shop would choose that course of action rather than just mark the cones up a dime or so.
If it’s a national franchise I’d say they don’t have that option because prices are set already.
Anybody know?
I know a store that tried it. They lost a lot of business.
Yes, CC cost a few cents, but they bring in a lot of business, which is why merchants use them. The little stickers with the Visa and Mastercharge logo increase sales. They advertise they accept CC, but then they sneakily add on a charge after the customer is done, knowing full well that very few customer will do anything after all the sales business has gone on. If they put up a sign “CC sales subject to 25 cent surcharge” many customers wouldn’t even start a sale.
So, not only is it a violation of their contract with Visa, etc; it is False Advertising and a Deceptive Trade Practice.
You know, Cash costs a merchant too. The bank can charge them a small amount to both withdraw and deposit cash, depending. Then we add in employee pilfering, incorrect change and “hold up” insurance. So, how would you fell if a merchant said- after you pulled out your wallet and started to pay cash “Oh, there is a 2% surcharge if you pay by cash, 5% if you pay by CC and 10% if you pay by check.” Wouldn’t that upset you? After all, the price is right there, and he wants more $$, right? “Well the merchant has to pay Visa extra for CC transactions, so he should be able to add on a secret surcharge, and dudes are cheap assholes if they complain”= the merchant also pays a little bit extra to handle cash, so if he charges cash customer extra, that must be OK, too right?
This happens frequently in Asia, although it has gotten better in Thailand in recent years. Some people are more sympathetic to the store owners, because of the fee thay must pay on each charge, but the theory IS that accepting credit cards brings the store more business, thus cancelling out any disadvantage of paying the charge.
What you do is ask for a receipt and specify that it must be itemized, which hopefully will include the extra charge. If it does, contact your card agency and point it out to them. They will cancel that part of the transaction. If you cannot get the charge itemized in a receipt, then you have no way of proving that it happened.
I, too, remember back in the US some shops got around this by not charging an extra fee for credit cards, but rather offering a discount for paying in cash.
I recall a Chinese restaurant I used to patronize in Toronto. If you paid in cash, they’d deduct 10% from the bottom line. If you paid by credit card, the bottom line was what you paid. That seemed fair; and there were no quibbles over extra charges over and above what you has contracted for. After all, by ordering the food, you agreed to pay the menu prices. Ten percent off the menu prices for paying cash was a bonus.
I wonder if there was more to it than credit card fees. Some contractors offer cash discounts because cash doesn’t create a paper trail, making it easier to evade taxes.
I don’t know, but my guess is that it’s some combination of
- They don’t make many credit card sales, and it’s easier (fewer opportunities for mistakes) to charge an extra quarter on 5% of sales rather than giving a discount on 95% of sales.
- The average credit card sale is an amount which makes a set .25 fee per sale reflect their cost better than a either a per item or percentage price increase.
- It didn’t occur to the owner that raising all of the prices a dime without offering a cash discount would increase profits, while probably not affecting sales at all.
It’s probably only practical for places where most sales are under $20- but it’s also probably only necessary in those places. Accepting credit cards doesn’t actually increase their business enough to offset the fees- it seems that most people still carry enough cash for small purchases such as snacks and newspapers. If the credit card companies started to enforce that part of the agreement, they would either raise their prices- or more likely not bother accepting credit cards. And that is almost certainly the reason the credit card companies don’t enforce it. Although an individual store might not lose much business by not accepting credit cards, that doesn’t mean Visa won’t lose if hundreds ( or more likely, thousands) of such stores stop accepting cards because this part of the agreement is enforced.
Even if the Visa Card in the OP was a Visa Debit Card, the reality is that it functions in exactly the same way as a conventional credit card, the difference being that you’ve actually got money in your account to pay for it with, rather than drawing on a line of credit.
Besides, if it’s a debit card, then surely you’ve got a a PIN attached to it, right? In which case, you can avoid the 25c surcharge by the expedient of entering your PIN, rather than signing for your purchase, right?
I see no problem with businesses passing on increased costs because of credit card fees to customers provided they tell people up front- our local newsagent has a sign saying there’s a 30c fee to cover all credit/debit card sales under $10, and I’m fine with that.
Incidentally, every single place I used my credit card in the US a few months ago wanted to see ID. Not interested in the signature, just seeing some form of ID. Apparently this is a violation of the Visa Merchant agreement? In that case, someone should tell Visa that every major business in Anaheim and Santa Monica is breaching their agreement with them. I doubt Visa care, somehow.
Small businesses are in a no win situation with this. Don’t charge a fee, and let someone pay for a two liter Coke only with a debit card, and due to Visa’s bullshit fees they lose money on that type sale. Their other option, don’t accept cards, and probably go out of business due to lost debit card sales. Other option, charge a fee to negate Visa’s fee, and piss off customers, and probably go out of business anyway. And yes, they all agree to Visa’s fee schedule, but what choice do they have?
I’ve read this twice and have no idea what you are babbling about.
The question was directed mainly at those who were complaining that an extra charge for CC or a purchase minimum is a violation of their contract with the CC company. And the specifics are this.
If a store raised it prices a few percentage points to cover the cost of transaction fees but then displays a sign offering a 5% discount for cash purchases would these same people be okay with that, since it is now honoring the CC agreement but still costing them a little extra to pay with their card?
"Exactamundo" ,mks57
Maybe, but not alwasy so, some plays charge for this, and the merchant agreement generally says nothing, IIRC.
Let me 'splain, no let me sum up; there are charges and costs associated with CASH as well as CC. Sure a store could do that, but how about if a store added on a surcharge for every purchase, cash, check or CC? I could justify a surcharge for cash just as easily as CC, they both cost merchants roughly the same.
If it was a one-off, such as a simple mistake or misunderstanding on the part of a staff member, I’d let it slide. Since it’s a matter of company policy and that company policy is in violation of the agreement, I’d report it - first to the company’s head office and if no satisfactory response was forthcoming, then to the credit card company. It’s nothing much to do with the amount charged - it’s the principle.