re: 3% Credit Card Fee

I just pay cash when the merchant pays a fee. Now the merchant has to deal with the hassle of cash as well as the ease of theft by employees.

Its a fee that all merchants taking credit cards have to pay. It can range from 3 to 6 % depending on the type of card a customer uses and their contract with the processor. All that cash back and flyer miles are being paid by the merchants who accept these cards. The processors and banks are making a killing and there isn't much that can be done with how everyone uses cards now.

We as customers get screwed with higher prices, merchants get screwed with more fees, and banks/credit card companies/processors are just raking in the money.

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I just pay cash when the merchant pays a fee. Now the merchant has to deal with the hassle of cash as well as the ease of theft by employees.

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I just called the marina and had a conversation about it. I told them I wouldn’t be back and I haven’t been. I got a new boat since then with an 80 gallon tank and a VP 496 cu in so I may eat those words. Lol.

I've seen this framed the opposite. 3% discount for cash payment at gas stationd and liquor stores.

I noticed this too when I went home to Louisiana this past Christmas. Definitely a trend down there. Haven’t seen that before here in the PNW. I will say that merchant fees have gotten pretty high according to business owners. Sounds like there is some sort of monopoly. However, I usually wont go to places that pass it off to the customer.

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AT&T cell service removed my deduction for paperless autopay a few months ago that I had auto charged ti my credit card. They never let me know, just started charging more per month to my bill. I had to use a debit card or my checking account to get the deduction.

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Thanks for posting this. I need to check mine now.

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My problem with this is that the merchant is allowed to offer credit without having to have a credit and collection department. Accepting CC is outsourcing the credit function to increase sales, yet now the merchant does want to pay the outsourcing fee that helps them increase sales.

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I get what you’re saying in principle, but I think that’s a somewhat antiquated way to look at credit cards nowadays.

I don’t think that specific value proposition - outsourcing credit/debt collection - really matters for the vast majority of merchants today. A gas station isn’t in a position to stop taking credit cards and start running their own credit accounts in the first place. Customers don’t want to deal with that.

If you look at merchants who deal with larger purchases, I don’t think it really applies to them either. A car dealership who offers financing options is not absorbing the cost of collections. In fact, they’re getting a kickback while still outsourcing it. The cost of collections are built into the bank’s rates. But if you use a credit card, they have to pay for the transaction. Why is it different?

IMHO, the cost associated with collections/debt service should be built into credit card users’ rates as well. Especially when you look at the higher fees from AMEX and Discover. There’s no benefit to the merchant for processing via AMEX instead of Visa/MC. The customer is the one getting value, in the form of cardholder benefits and/or rates. So why should other customers have to subsidize those benefits?

I guess my position is this: I don’t really like blanket 3% fees but I also don’t have a problem with the general idea of merchants passing those costs back to the customer. In a perfect system, I’d think the merchant fees would be basically equal for credit and debit purchases and it would be a non-issue.

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I've seen many merchants take advantage of a 3% processing fee and surcharge 4.5%, blaming the banks, but the merchants have gotten greedy and don't want to incur legit costs of offering credit.

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I do agree that it’s shitty when they try to take advantage for an extra profit, which I think is likely still happening even with a 3% blanket fee to customers.

Very insightful posts. I’m moreso against big government and prefer that small businesses have more freedom, but how is it legal/ok for the merchant to not accept cash?

Some of these CC terminals charge 3% fees that aren't integrated with the POS, so you see one total on the register but a higher one on the card reader. I watched a guy lose his mind over that.