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Another similar notion is with credit card payments for convenience items at bakeries, deli, and pizza restaurants. A company called "4shifts" is notorious for

Another similar notion is with credit card payments for convenience items at bakeries, deli, and pizza restaurants. A company called "4shifts" is notorious for telling owners to place a sign on the register "a convenience charge of 3.5% will be added to the sale if you use a credit card". Add the 3.5% plus sales tax which increases the sale by 8% - 12% depending on the state you live in. 4shifts is also used in major stadium venues.

alwayslikethis 4y ago
Why should they bear the cost of credit card payment processing? Cash buyers shouldn't have to subsidize credit card users.
- askvictor 4y ago
  Cash isn't free either (you need a float, security/insurance for the risk of theft, employee mistakes/theft, accounting costs to reconcile the days earnings). It's just that these costs are often internalised by the company (I have no idea what the actual cost is compared to a credit card surcharge, but it's non-zero). Then (depending on your political views) there's the broader cost to society of tax-evasion that sometimes comes with cash payments (I'm not saying that cash is bad, but it's pretty clear that some businesses that are cash-only are avoiding tax and paying workers under-the-table, which has impacts both for government and the workers involved)
- janalsncm 4y ago
  Premium card users are also subsidized by basic card users.
fallous 4y ago
That sounds like a violation of the Visa/Mastercard agreement. Those networks do, in fact, charge the merchant for the use of the network but their licensing agreement specifically prohibits mentioning that surcharge or passing it on to the customer. Instead the allowable method is to provide a "cash discount." That surcharge is also why most credit card terminals default to debit card when presented Visa/MC debit card is used. Debit cards incur a lower fee from the network than the credit card fee. Of course the customer also has less recourse using debit vs credit when it comes to chargebacks, extended warranties, etc.

alwayslikethis 4y ago

Why should they bear the cost of credit card payment processing? Cash buyers shouldn't have to subsidize credit card users.

askvictor 4y ago
Cash isn't free either (you need a float, security/insurance for the risk of theft, employee mistakes/theft, accounting costs to reconcile the days earnings). It's just that these costs are often internalised by the company (I have no idea what the actual cost is compared to a credit card surcharge, but it's non-zero). Then (depending on your political views) there's the broader cost to society of tax-evasion that sometimes comes with cash payments (I'm not saying that cash is bad, but it's pretty clear that some businesses that are cash-only are avoiding tax and paying workers under-the-table, which has impacts both for government and the workers involved)
janalsncm 4y ago
Premium card users are also subsidized by basic card users.

fallous 4y ago

That sounds like a violation of the Visa/Mastercard agreement. Those networks do, in fact, charge the merchant for the use of the network but their licensing agreement specifically prohibits mentioning that surcharge or passing it on to the customer. Instead the allowable method is to provide a "cash discount." That surcharge is also why most credit card terminals default to debit card when presented Visa/MC debit card is used. Debit cards incur a lower fee from the network than the credit card fee. Of course the customer also has less recourse using debit vs credit when it comes to chargebacks, extended warranties, etc.