Credit Card Fees passed through from merchant

[Anonymous]

You do know Trump did away with the cap for these fees right?

[Anonymous]

Just pay via check or EFT.

Credit cards come with fraud protections and rewards. Can’t get those for free.

[Anonymous]

Anonymous wrote:The reason you’re seeing more vendors passing on the credit card interchange fee is because states are passing laws allowing them to do this. And if you pay a 3% processing fee for using a credit card at a vendor, you just defeated the purpose of using that credit card for “rewards”. You paid for them in the processing fee and actually probably lost money. Nothing is free.

Thank you. I didn't know this. And yes, I don't think my "cash back" is so great when I paid "more" for it.

[Anonymous]

Anonymous wrote:I don’t. But you are fortunate and people do have true emergencies or problems that crop up like unexpected major auto work and they might need a few months to pay it off. Some people work hard and even have two jobs but aren’t able to build an adequate reserve. Paying astronomical interest rates sure doesn’t help the situation.

Oh I agree the rates should be lower. But for over 60% of people with CC debt, it's for "wants" not needs. Just like people buy cars and look for a deal where the monthly payment is affordable to them, they don't care for how many years, just that they can pay it monthly. Versus trying to only buy a car they can afford and try to pay it off in 3-4 years.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My issue with the credit card processing fees are the businesses who are cashless. There is no option but to pay the extra percent plus transaction fee.

Use a debit card or simply find another business to frequent.

Not always an option, but you knew that when you wrote that snark. Have a nice day.

Why not? That is what I do. I only have one business I use that I pay a CC fee. It's a small plumbing business. And I just pay it because I don't feel like writing a check, mailing it and then praying the USPS actually delivers it. So I just pay the fee. Otherwise all businesses I frequent don't charge a fee or they allow online bill pay with your banking info. To make that more secure, I have an account that I only use for such transactions. So if it's ever compromised there is only a small amount in it and I don't have to change ALL of my autoplays, etc.

Because you have a data point of one, it is not a universal experience.

FYI, many service providers and other types of companies are charging 1-2% for an electronic check (which is what you call online bill pay with your banking info). That used to be my default, but I had 3 vendors last week change their policies and start that fee. 1% for a wire. And they don't take cash, for anything.

I would start checking your autopays, because many places are changing.

So far I"m good. And none of my businesses charge for an electronic check

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I get that the merchant faces processing fees and prefers a check. When I can, I write a check. I still have checks.
But how do they justify charging as a PERCENT? It should be a flat transaction fee! So the more I spend, the more it costs them to process my credit card? We tried to buy online tickets for a charity gala, and of course they don't want credit card fees to offset their fundraising, but as we clicked up to "platinum table tickets" or whatever, the fees for the tickets went up to like $250! Guess who didn't buy charity tickets.

Because they get charged 3% of the charge.

okay, so there are so many people saying the merchants are just passing along their charges. THIS ISN"T TRUE. merchants aren't charged that much. A few years ago, the fees were reduced and the merchants never lowered their fees when "passing them on." They kept the higher amount to charge customers. They are making money off the fees they are charging you.

Keep in mind that with credit cards, merchants are guaranteed the money. If the customer doesn't pay the credit card bill, the bank eats that cost. If there's fraud, the bank eats that cost. If you pay by check, and there's no money, the merchant eats that cost. So, merchants should NOT be passing any of those fees to you - they are guaranteed money if you pay by credit card. Something they should pay for.

Have you ever heard of a chargeback? The bank does not eat that cost.

+1 Also, the PP saying there are lower merchant fees now isn't right. I own a business that accepts credit cards and the fees vary based on whether it's a reward card vs. regular credit card vs. debit card. However, you aren't permitted to charge a processing fee for debit cards, so those don't really count.

Discover and American Express are the absolute worst. The fees they charge the merchant are very high.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I get that the merchant faces processing fees and prefers a check. When I can, I write a check. I still have checks.
But how do they justify charging as a PERCENT? It should be a flat transaction fee! So the more I spend, the more it costs them to process my credit card? We tried to buy online tickets for a charity gala, and of course they don't want credit card fees to offset their fundraising, but as we clicked up to "platinum table tickets" or whatever, the fees for the tickets went up to like $250! Guess who didn't buy charity tickets.

Because they get charged 3% of the charge.

okay, so there are so many people saying the merchants are just passing along their charges. THIS ISN"T TRUE. merchants aren't charged that much. A few years ago, the fees were reduced and the merchants never lowered their fees when "passing them on." They kept the higher amount to charge customers. They are making money off the fees they are charging you.

Keep in mind that with credit cards, merchants are guaranteed the money. If the customer doesn't pay the credit card bill, the bank eats that cost. If there's fraud, the bank eats that cost. If you pay by check, and there's no money, the merchant eats that cost. So, merchants should NOT be passing any of those fees to you - they are guaranteed money if you pay by credit card. Something they should pay for.

Have you ever heard of a chargeback? The bank does not eat that cost.

+1 Also, the PP saying there are lower merchant fees now isn't right. I own a business that accepts credit cards and the fees vary based on whether it's a reward card vs. regular credit card vs. debit card. However, you aren't permitted to charge a processing fee for debit cards, so those don't really count.

Discover and American Express are the absolute worst. The fees they charge the merchant are very high.

The merchant eats the chargeback because in those cases, the merchant messed up. This is a consumer protection.

For example—I order an item on an online platform and it never arrives. Neither the platform nor seller care and take my money. I contest with my credit card company, who protects me and doesn’t make me pay after I provide clear evidence of malfeasance.

And we, as consumers benefit from 1) the fraud protection and 2) the faith that the issuing bank has in the consumer being able to pay (eventually). Also, so many other fraud protections, cyber, rewards, etc. That costs something to operate. Way cheaper than the markup on uber or DoorDash!

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I get that the merchant faces processing fees and prefers a check. When I can, I write a check. I still have checks.
But how do they justify charging as a PERCENT? It should be a flat transaction fee! So the more I spend, the more it costs them to process my credit card? We tried to buy online tickets for a charity gala, and of course they don't want credit card fees to offset their fundraising, but as we clicked up to "platinum table tickets" or whatever, the fees for the tickets went up to like $250! Guess who didn't buy charity tickets.

Because they get charged 3% of the charge.

okay, so there are so many people saying the merchants are just passing along their charges. THIS ISN"T TRUE. merchants aren't charged that much. A few years ago, the fees were reduced and the merchants never lowered their fees when "passing them on." They kept the higher amount to charge customers. They are making money off the fees they are charging you.

Keep in mind that with credit cards, merchants are guaranteed the money. If the customer doesn't pay the credit card bill, the bank eats that cost. If there's fraud, the bank eats that cost. If you pay by check, and there's no money, the merchant eats that cost. So, merchants should NOT be passing any of those fees to you - they are guaranteed money if you pay by credit card. Something they should pay for.

Have you ever heard of a chargeback? The bank does not eat that cost.

+1 Also, the PP saying there are lower merchant fees now isn't right. I own a business that accepts credit cards and the fees vary based on whether it's a reward card vs. regular credit card vs. debit card. However, you aren't permitted to charge a processing fee for debit cards, so those don't really count.

Discover and American Express are the absolute worst. The fees they charge the merchant are very high.

The merchant eats the chargeback because in those cases, the merchant messed up. This is a consumer protection.

For example—I order an item on an online platform and it never arrives. Neither the platform nor seller care and take my money. I contest with my credit card company, who protects me and doesn’t make me pay after I provide clear evidence of malfeasance.

And we, as consumers benefit from 1) the fraud protection and 2) the faith that the issuing bank has in the consumer being able to pay (eventually). Also, so many other fraud protections, cyber, rewards, etc. That costs something to operate. Way cheaper than the markup on uber or DoorDash!

Do the credit card companies really collect from merchants though?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I get that the merchant faces processing fees and prefers a check. When I can, I write a check. I still have checks.
But how do they justify charging as a PERCENT? It should be a flat transaction fee! So the more I spend, the more it costs them to process my credit card? We tried to buy online tickets for a charity gala, and of course they don't want credit card fees to offset their fundraising, but as we clicked up to "platinum table tickets" or whatever, the fees for the tickets went up to like $250! Guess who didn't buy charity tickets.

Because they get charged 3% of the charge.

okay, so there are so many people saying the merchants are just passing along their charges. THIS ISN"T TRUE. merchants aren't charged that much. A few years ago, the fees were reduced and the merchants never lowered their fees when "passing them on." They kept the higher amount to charge customers. They are making money off the fees they are charging you.

Keep in mind that with credit cards, merchants are guaranteed the money. If the customer doesn't pay the credit card bill, the bank eats that cost. If there's fraud, the bank eats that cost. If you pay by check, and there's no money, the merchant eats that cost. So, merchants should NOT be passing any of those fees to you - they are guaranteed money if you pay by credit card. Something they should pay for.

Have you ever heard of a chargeback? The bank does not eat that cost.

+1 Also, the PP saying there are lower merchant fees now isn't right. I own a business that accepts credit cards and the fees vary based on whether it's a reward card vs. regular credit card vs. debit card. However, you aren't permitted to charge a processing fee for debit cards, so those don't really count.

Discover and American Express are the absolute worst. The fees they charge the merchant are very high.

The merchant eats the chargeback because in those cases, the merchant messed up. This is a consumer protection.

For example—I order an item on an online platform and it never arrives. Neither the platform nor seller care and take my money. I contest with my credit card company, who protects me and doesn’t make me pay after I provide clear evidence of malfeasance.

And we, as consumers benefit from 1) the fraud protection and 2) the faith that the issuing bank has in the consumer being able to pay (eventually). Also, so many other fraud protections, cyber, rewards, etc. That costs something to operate. Way cheaper than the markup on uber or DoorDash!

Do the credit card companies really collect from merchants though?

Of course, it gets deducted from the deposits sent to the merchant

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I get that the merchant faces processing fees and prefers a check. When I can, I write a check. I still have checks.
But how do they justify charging as a PERCENT? It should be a flat transaction fee! So the more I spend, the more it costs them to process my credit card? We tried to buy online tickets for a charity gala, and of course they don't want credit card fees to offset their fundraising, but as we clicked up to "platinum table tickets" or whatever, the fees for the tickets went up to like $250! Guess who didn't buy charity tickets.

How can you be someone who is blowing $$$ on a charity gala but not know credit cards charge a percentage from each merchant??

Because it is only very recently that merchants are passing them along to customers.
It defeats the purpose of using credit cards at all.

Is to spend money one doesn't have.

Use cash and you will never be in debt.

Or use credit cards smartly. I never pay a Fee---if a business charges me for using a cc I simply use a check or online payment from Bank Account. However, if they don't charge a fee, then I'm using a CC and getting my perks. Put my $55K roof on 2 credit cards a few years ago. Business wasn't giving me a discount for cash, so why wouldn't I get my 2%+ back.

I put everything (without a fee) on CC and get my perks. Then pay everything in full each month. Because I don't purchase things I cannot afford. But paying cash would cost me $5K+ yearly. Silly not to utilize the system properly

Heck when we purchased a new car, they allowed $10K on a CC so we did it. then wrote a check for the rest

I don't know of any car dealership that would allow you to put $10K on a CC for a new car. Which dealer was this (please be specific)?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I get that the merchant faces processing fees and prefers a check. When I can, I write a check. I still have checks.
But how do they justify charging as a PERCENT? It should be a flat transaction fee! So the more I spend, the more it costs them to process my credit card? We tried to buy online tickets for a charity gala, and of course they don't want credit card fees to offset their fundraising, but as we clicked up to "platinum table tickets" or whatever, the fees for the tickets went up to like $250! Guess who didn't buy charity tickets.

Because they get charged 3% of the charge.

okay, so there are so many people saying the merchants are just passing along their charges. THIS ISN"T TRUE. merchants aren't charged that much. A few years ago, the fees were reduced and the merchants never lowered their fees when "passing them on." They kept the higher amount to charge customers. They are making money off the fees they are charging you.

Keep in mind that with credit cards, merchants are guaranteed the money. If the customer doesn't pay the credit card bill, the bank eats that cost. If there's fraud, the bank eats that cost. If you pay by check, and there's no money, the merchant eats that cost. So, merchants should NOT be passing any of those fees to you - they are guaranteed money if you pay by credit card. Something they should pay for.

Have you ever heard of a chargeback? The bank does not eat that cost.

+1 Also, the PP saying there are lower merchant fees now isn't right. I own a business that accepts credit cards and the fees vary based on whether it's a reward card vs. regular credit card vs. debit card. However, you aren't permitted to charge a processing fee for debit cards, so those don't really count.

Discover and American Express are the absolute worst. The fees they charge the merchant are very high.

The merchant eats the chargeback because in those cases, the merchant messed up. This is a consumer protection.

For example—I order an item on an online platform and it never arrives. Neither the platform nor seller care and take my money. I contest with my credit card company, who protects me and doesn’t make me pay after I provide clear evidence of malfeasance.

And we, as consumers benefit from 1) the fraud protection and 2) the faith that the issuing bank has in the consumer being able to pay (eventually). Also, so many other fraud protections, cyber, rewards, etc. That costs something to operate. Way cheaper than the markup on uber or DoorDash!

Do the credit card companies really collect from merchants though?

Of course, it gets deducted from the deposits sent to the merchant

Ok and if the merchant doesn't like it or disputes it or thinks the cc companies are being too liberal with their money they are free to part ways. I do like having the protection of the credit card company and the chargeback option. Can you imagine if we didn't have that option at all?

[Anonymous]

But isn't there a cost to these companies for using cash? They have to pay Brinks trucks and such? And isn't there a cost to them for managing echecks?

[Anonymous]

I get 2% back on my credit card, so I usually weigh that in my mind if I'm going to pay a 3% surcharge to use it. It's really only costing me 1% then.

[Anonymous]

Anonymous wrote:But isn't there a cost to these companies for using cash? They have to pay Brinks trucks and such? And isn't there a cost to them for managing echecks?

Cash payments are by far the biggest headache for a business to handle vs other methods. Our back office process for handling electronically deposited checks is nearly identical to handling credit card sales. The difference is it costs us $200 a month to run a million in checks vs ~$22K for that same million in cards. We started offering a discount for payments by check in the fall of 2023 for our big jobs. Factoring in the discount it ended up being just over $100K in found money in 2024. Its a double edged sword though; I used to be able to easily charge $10 Million in expenses on our Business Amex any given year. I couldn't tell you the last time I paid to travel or eat out. More and more our vendors are going the same way either introducing a fee for credit card payments or juicing up the discount terms.

[Anonymous]

Anonymous wrote:

Anonymous wrote:But isn't there a cost to these companies for using cash? They have to pay Brinks trucks and such? And isn't there a cost to them for managing echecks?

Cash payments are by far the biggest headache for a business to handle vs other methods. Our back office process for handling electronically deposited checks is nearly identical to handling credit card sales. The difference is it costs us $200 a month to run a million in checks vs ~$22K for that same million in cards. We started offering a discount for payments by check in the fall of 2023 for our big jobs. Factoring in the discount it ended up being just over $100K in found money in 2024. Its a double edged sword though; I used to be able to easily charge $10 Million in expenses on our Business Amex any given year. I couldn't tell you the last time I paid to travel or eat out. More and more our vendors are going the same way either introducing a fee for credit card payments or juicing up the discount terms.

This is what merchants should be doing.