# Legal to discourage certain types of credit cards? **URL:** \ **Category:** Factual Questions\ **Created:** [February 24, 2009, 12:38am UTC](https://boards.straightdope.com/t/legal-to-discourage-certain-types-of-credit-cards/487132 "2009-02-24T00:38:54Z")\ **Posts on this page:** 8\ **Page:** 2
**Author:** ![UltraVires](https://avatars.discourse-cdn.com/v4/letter/u/ecccb3/32.png) [@UltraVires](https://boards.straightdope.com/u/UltraVires)\ **Post date:** [March 26, 2009, 12:49pm UTC](https://boards.straightdope.com/t/legal-to-discourage-certain-types-of-credit-cards/487132/21 "2009-03-26T12:49:15Z")
> [@Driver8](#): > > I think what it does is prevent them from advertising a price, but then charging a higher price when they see you are using a card. So if I drive by a huge sign that states “Apples, $1.00/pound” I won’t get all annoyed when I pull out my credit card and they try charge me $1.10/pound. I don’t think there is anything stopping them from charging me $0.90/pound if I tried to pay in cash. It doesn’t seem like much of a difference. In Florida you see these signs all of the time: Apples, $1.00/pound Includes Cash Discount You are still in for a surprise when you use a credit/debit card. I’m with some of the others: this seems like a silly law where the state is injecting itself into a matter where it has no business, and it has no effect. ---
**Author:** ![DSYoungEsq](https://avatars.discourse-cdn.com/v4/letter/d/c6cbf5/32.png) [@DSYoungEsq](https://boards.straightdope.com/u/DSYoungEsq)\ **Post date:** [March 26, 2009, 4:53pm UTC](https://boards.straightdope.com/t/legal-to-discourage-certain-types-of-credit-cards/487132/22 "2009-03-26T16:53:26Z")
I expect, **jtgain** , that the state requires that the apples have a price shown for the full, non-discount price as well. Certainly, California law requires that. So it is not the same thing entirely at all. Please also note that the fact you see signs like that doesn’t mean that the signs aren’t violating some law, or some portion of the contract between the merchant and VISA/Amex/MasterCard. I see minimum cash purchase requirement signs all the time, and not always at mom & pop places. The Barney’s convenience stores in the Toledo area were doing that last summer; these are connected to the local BP/Mobil gas stations, so not some small operation. ---
**Author:** ![Gfactor](https://avatars.discourse-cdn.com/v4/letter/g/9de053/32.png) [@Gfactor](https://boards.straightdope.com/u/Gfactor)\ **Post date:** [March 27, 2009, 1:42am UTC](https://boards.straightdope.com/t/legal-to-discourage-certain-types-of-credit-cards/487132/23 "2009-03-27T01:42:43Z")
Here is one more statute that adds to the complexity of the cash discount/credit surcharge issue: > [@](#): > > (a) Cash discounts > With respect to credit card which may be used for extensions of credit in sales transactions in which the seller is a person other than the card issuer, the card issuer may not, by contract, or otherwise, prohibit any such seller from offering a discount to a cardholder to induce the cardholder to pay by cash, check, or similar means rather than use a credit card. > (b) Finance charge > With respect to any sales transaction, any discount from the regular price offered by the seller for the purpose of inducing payment by cash, checks, or other means not involving the use of an open-end credit plan or a credit card shall not constitute a finance charge as determined under section 1605 of this title if such discount is offered to all prospective buyers and its availability is disclosed clearly and conspicuously. [http://www.law.cornell.edu/uscode/15/usc\_sec\_15\_00001666---f000-.html](http://www.law.cornell.edu/uscode/15/usc_sec_15_00001666---f000-.html) ---
**Author:** ![drachillix](https://avatars.discourse-cdn.com/v4/letter/d/48db29/32.png) [@drachillix](https://boards.straightdope.com/u/drachillix)\ **Post date:** [March 27, 2009, 1:56am UTC](https://boards.straightdope.com/t/legal-to-discourage-certain-types-of-credit-cards/487132/24 "2009-03-27T01:56:50Z")
> [@t-bonham@scc.net](#): > > It’s real easy in businesses like that to just pocket the cash payments from a few customers each night, and have a nice unreported, untaxed extra income. But when the customer pays with a credit card, there is a paper trail, and they have to report this income. If I have a choice, I take checks. In my case (computer shop) CC charges are often pretty hefty. Sell a computer and $15-20 a whack is not uncommon. Do that a dozen times a month and it adds up in a hurry. My average ticket is about $150 or about $3-4 per transaction. I know amex is at a higher rate but I have not nitpicked it because only a handful of customers seem to use it. You don’t see VISA/MC/etc doing much about the minimum purchases and such because they still get the money, and it is effectively biting the hand that feeds them. ---
**Author:** ![UltraVires](https://avatars.discourse-cdn.com/v4/letter/u/ecccb3/32.png) [@UltraVires](https://boards.straightdope.com/u/UltraVires)\ **Post date:** [March 27, 2009, 3:20pm UTC](https://boards.straightdope.com/t/legal-to-discourage-certain-types-of-credit-cards/487132/25 "2009-03-27T15:20:54Z")
> [@drachillix](#): > > If I have a choice, I take checks. In my case (computer shop) CC charges are often pretty hefty. Sell a computer and $15-20 a whack is not uncommon. Do that a dozen times a month and it adds up in a hurry. My average ticket is about $150 or about $3-4 per transaction. I know amex is at a higher rate but I have not nitpicked it because only a handful of customers seem to use it. > > You don’t see VISA/MC/etc doing much about the minimum purchases and such because they still get the money, and it is effectively biting the hand that feeds them. I understand that, but the old way of selling items on credit left businesses with bad debt, an expense that the credit card companies now bear. There is a cost of selling on credit, but most businesses do so because the profits outweigh the costs. If the fees are so onerous, then why does your business accept credit/debit cards? ---
**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:** [March 27, 2009, 5:02pm UTC](https://boards.straightdope.com/t/legal-to-discourage-certain-types-of-credit-cards/487132/26 "2009-03-27T17:02:20Z")
> [@jtgain](#): > > If the fees are so onerous, then why does your business accept credit/debit cards? Is this a serious question? Do you really not know the answer? He accepts credit cards because just about everyone in the known universe expects to be able to pay with credit cards. Accepting credit cards allows him to make sales that he would not be able to make if he didn’t accept them. That doesn’t mean, however, that the fees associated with taking them don’t cut into his margins, sometimes substantially. And even though he takes credit card, there’s nothing surprising about the fact that, all other things being equal, he would prefer everyone to pay by cash or check. ---
**Author:** ![drachillix](https://avatars.discourse-cdn.com/v4/letter/d/48db29/32.png) [@drachillix](https://boards.straightdope.com/u/drachillix)\ **Post date:** [March 28, 2009, 12:27am UTC](https://boards.straightdope.com/t/legal-to-discourage-certain-types-of-credit-cards/487132/27 "2009-03-28T00:27:13Z")
> [@mhendo](#): > > That doesn’t mean, however, that the fees associated with taking them don’t cut into his margins, sometimes substantially. And even though he takes credit card, there’s nothing surprising about the fact that, all other things being equal, he would prefer everyone to pay by cash or check. Correct, especially in a world where a significant percentage of my potential customer base can easily find stuff and order it from tiger or newegg not realizing their whole business model is razor thin margins and charging massive shipping fees. Computers tend to be low margin sales, losing another 2-3% can often be losing 1/3 of what you make on the hardware sale. ---
**Author:** ![Balthisar](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/balthisar/32/2825_2.png) [@Balthisar](https://boards.straightdope.com/u/Balthisar)\ **Post date:** [March 29, 2009, 2:12am UTC](https://boards.straightdope.com/t/legal-to-discourage-certain-types-of-credit-cards/487132/28 "2009-03-29T02:12:42Z")
> [@drachillix](#): > > Correct, especially in a world where a significant percentage of my potential customer base can easily find stuff and order it from tiger or newegg not realizing their whole business model is razor thin margins and charging massive shipping fees. Computers tend to be low margin sales, losing another 2-3% can often be losing 1/3 of what you make on the hardware sale. I wonder which model is screwed up. Tiger and Newegg both have exceptionally good shipping fees, and don’t make an ugly face when I whip out my Mastercard. I think everyone knows that you should order from Tiger Direct or Newegg, unless you _need_ it now. And you know what? When I _need_ a computer part now, I’m glad to pay 50% more than the online price just to be able to get it now. I’m not trying to be insulting; on the contrary, I have no idea how in the world you think you can compete with those types of prices, even factoring in the shipping! [Previous page](https://boards.straightdope.com/t/legal-to-discourage-certain-types-of-credit-cards/487132.md?page=1)