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I feel like there could be a simpler solution that requires less obligation from the government. I believe merchants are mostly prohibited from passing on credi

I feel like there could be a simpler solution that requires less obligation from the government. I believe merchants are mostly prohibited from passing on credit card fees[0], or even requiring a minimum purchase[1], by credit card service providers. I think it should be made illegal to prohibit merchants from passing on fees however they see fit. The problem with the status quo is that credit card companies, on top of already making a generous profit, provide incentives like cashback that make it foolish for consumers to not pay with a credit card. If they could pass on the fees, then 1% cashback bonuses might not look so good, and people might shift some purchases away from cards (as just one outcome). The price of the convenience of the card would also be more upfront and the consumer market could properly respond. [0] This could vary by state, and I think there are some pending suits dealing with this issue. [1] It's still common to see this at small businesses, but I believe technically you can report businesses that do this.

gergles 10y ago
The outcome of this settlement was to permit passing on fees and to allow minimums. Now that has been thrown out, so let's go right back to the old way where I could trust that using a credit card would work and not cost money. The "convenience" argument for credit cards makes no sense to me. As a business owner, it's way more convenient to have money just magically appear in my account than it is to have to count it, store it, transport it to the bank, pay for it to be processed at the bank, and worry about somebody walking off with it at any point in that process. We can quibble over how much that's worth, but I think it's worth way more than the EU caps for interchange (0.3%) - especially given that the networks and card issuers do have to eat a significant amount of fraud.
- TheCowboy 10y ago
  I'm not clear on how my solution negatively affects you as a business owner. It doesn't require you to pass on the fees. It's up to you as the business owner. Unless you think you might lose out on competition adding the fees and accepting cash at a discount. If anything, it could possibly lead to more competition on fees and charges by credit card service providers.

gergles 10y ago

The outcome of this settlement was to permit passing on fees and to allow minimums. Now that has been thrown out, so let's go right back to the old way where I could trust that using a credit card would work and not cost money. The "convenience" argument for credit cards makes no sense to me. As a business owner, it's way more convenient to have money just magically appear in my account than it is to have to count it, store it, transport it to the bank, pay for it to be processed at the bank, and worry about somebody walking off with it at any point in that process. We can quibble over how much that's worth, but I think it's worth way more than the EU caps for interchange (0.3%) - especially given that the networks and card issuers do have to eat a significant amount of fraud.

TheCowboy 10y ago
I'm not clear on how my solution negatively affects you as a business owner. It doesn't require you to pass on the fees. It's up to you as the business owner. Unless you think you might lose out on competition adding the fees and accepting cash at a discount. If anything, it could possibly lead to more competition on fees and charges by credit card service providers.