4 ms·

>It is very clear that most merchants earn more from people using credit cards more often, otherwise there is no reason they would try to dissuade or offset it

>It is very clear that most merchants earn more from people using credit cards more often, otherwise there is no reason they would try to dissuade or offset it by adding a premium for using credit cards. Can you elaborate? IME merchants do NOT want people to use credit cards; transaction fees eat into the sale price. I remember a time when some electronics stores would explicitly advertise a cash discount, so as to avoid the transaction fees. I once worked in a bar that accepted every major credit card, save American Express, because of their several-points-higher transaction fee. The premium is added to offset this. How is it very clear that most merchants earn more?

lotsofpulp 5y ago
> How is it very clear that most merchants earn more? Because they do not offer discounts for cash/debit, and they also do not charge a fee for using credit card. As I showed in my post, legally, merchants are clear to advertise higher prices for credit card users. The fact that they do not means they do not want to dissuade credit card use. From there, it follows that since businesses are interested in earning more money, that if they do not want to dissuade credit card use, then they must be earning more money (or at least breaking even) due to people using credit cards. People spend more money when they use credit cards than debit/cash. Note that my above post specified “most merchants”, not all merchants. Obviously, some merchants do benefit from dissuading credit card use, such as the examples I gave, or many gas stations and small restaurants or convenience stores.
- nobody9999 5y ago
  >Because they do not offer discounts for cash/debit, and they also do not charge a fee for using credit card. Except they do. Especially smaller, mom & pop stores, as I mentioned here[0]. [0] https://news.ycombinator.com/item?id=29128007 https://news.ycombinator.com/item?id=29128007
  - lotsofpulp 5y ago
    I also mentioned it… > Note that my above post specified “most merchants”, not all merchants. Obviously, some merchants do benefit from dissuading credit card use, such as the examples I gave, or many gas stations and small restaurants or convenience stores.
- perl4ever 5y ago
  >Obviously, some merchants do benefit from dissuading credit card use Or they just prefer to deal in cash so they don't have to pay as much in taxes.
kasey_junk 5y ago
Cash management is also very expensive for most merchants. There are effectively 3 reasons merchants might prefer cards to cash these days a) their volume is so low that cash management is not an issue (that is the transaction fees) b) their margins are so low on a particular item that the transaction fee eats all of it but the broader business still uses credit cards or c) they do not want an electronic record of the sale.
- alasdair_ 5y ago
  D) they sell cannabis and are not allowed to use the regular banking system.
astura 5y ago
Research suggests people simply tend to spend more when paying with plastic. Sometimes up to 100% more. https://www.nerdwallet.com/article/credit-cards/credit-cards-make-you-spend-more https://www.nerdwallet.com/article/credit-cards/credit-cards...

lotsofpulp 5y ago

> How is it very clear that most merchants earn more? Because they do not offer discounts for cash/debit, and they also do not charge a fee for using credit card. As I showed in my post, legally, merchants are clear to advertise higher prices for credit card users. The fact that they do not means they do not want to dissuade credit card use. From there, it follows that since businesses are interested in earning more money, that if they do not want to dissuade credit card use, then they must be earning more money (or at least breaking even) due to people using credit cards. People spend more money when they use credit cards than debit/cash. Note that my above post specified “most merchants”, not all merchants. Obviously, some merchants do benefit from dissuading credit card use, such as the examples I gave, or many gas stations and small restaurants or convenience stores.

nobody9999 5y ago
>Because they do not offer discounts for cash/debit, and they also do not charge a fee for using credit card. Except they do. Especially smaller, mom & pop stores, as I mentioned here[0]. [0] https://news.ycombinator.com/item?id=29128007 https://news.ycombinator.com/item?id=29128007
- lotsofpulp 5y ago
  I also mentioned it… > Note that my above post specified “most merchants”, not all merchants. Obviously, some merchants do benefit from dissuading credit card use, such as the examples I gave, or many gas stations and small restaurants or convenience stores.
perl4ever 5y ago
>Obviously, some merchants do benefit from dissuading credit card use Or they just prefer to deal in cash so they don't have to pay as much in taxes.

kasey_junk 5y ago

Cash management is also very expensive for most merchants. There are effectively 3 reasons merchants might prefer cards to cash these days a) their volume is so low that cash management is not an issue (that is the transaction fees) b) their margins are so low on a particular item that the transaction fee eats all of it but the broader business still uses credit cards or c) they do not want an electronic record of the sale.

alasdair_ 5y ago
D) they sell cannabis and are not allowed to use the regular banking system.

astura 5y ago

Research suggests people simply tend to spend more when paying with plastic. Sometimes up to 100% more. https://www.nerdwallet.com/article/credit-cards/credit-cards-make-you-spend-more https://www.nerdwallet.com/article/credit-cards/credit-cards...