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It’s actually super easy to do but the public will hate it. Pass a law that credit card surcharges MUST be added onto the final price. That 2% cashback you get

It’s actually super easy to do but the public will hate it. Pass a law that credit card surcharges MUST be added onto the final price. That 2% cashback you get for using your Amex isn’t due to Amex generosity. That’s literally what retailers pay. Right now I will absolutely use my cc for anything I can. It’s literally cheaper than cash and users of cash subsidise all my purchases. The only way to fix this is to force the surcharges on the cc users so cash users aren’t subsidising the price. But good luck getting that passed as law. Everyone either doesn’t care or thinks they are getting an amazing deal from the 2% back. It’s got to the point where stores that add a cc surcharge will be called out on social media when all they are doing is preventing cash from subsidising credit cards.

rootusrootus 2y ago
That seems like it would get complicated fast. Doesn't cash have its own additional handling costs that don't apply to credit card users? I'm not sure it's as easy as saying cash users are subsidizing anyone else.
- BJones12 2y ago
  For businesses to deposit cash at RBC (the largest Canadian bank) here's an account that charges $2.50 per $1,000 (branch), $2.25 per $1,000 (ATM) https://www.rbcroyalbank.com/business/accounts/flex-choice-business-account.html https://www.rbcroyalbank.com/business/accounts/flex-choice-b... Which is ~0.25%. Presumably a cash register also has some amortization on it.
  - nazcan 2y ago
    That does not include the cost of staff processing it.
    - miki123211 2y ago
      And the cost of staff pocketing some of it, and the cost times risk of it being stolen, and the psychological impact to employees of the store being worth robbing...
      - felixg3 2y ago
        You forgot cash pickup and delivery costs for big stores or sending two employees to the bank with the day’s revenue (that’s the cost a lot of cash-only merchants in Germany usually don’t calculate for). Also don’t forget the counting of the day’s cash, two employees 30 minutes each.
  - Teever 2y ago
    That sounds like something that could be regulated away if the government felt like it.
robocat 2y ago
edited: ignore this comment please, I totally misunderstood the comment! > Pass a law that credit card surcharges MUST be added onto the final price. You must be a rich person that supports monopolies! And clearly you know nothing about low margin retail businesses. If your profit margin is 5% and the credit card fees are 2.5% then you are saying profit should be split 50%/50% with Visa/Mastercard. In New Zealand originally the contract between the credit card company and the marchandiser said that the marchandiser couldn't charge a different amount for cash - an indirect way to force retailers to soak up the credit card fees. That clause was eventually outlawed here, for good reason. Your suggestion is to write the opposite law! The extra fees for credit cards are great. It is the customer's choice to pay them or not!
- AnotherGoodName 2y ago
  That’s exactly what I’m proposing though. Right now it’s cheaper to pay by credit card because I don’t pay the surcharge directly, it’s paid by all customers including cash customers. I have no choice but to pay by credit card. My proposal above is exactly what is required to make cash a choice. Btw did you read some idea that the surcharge applies to all purchases? The idea of charging the credit cards a surcharge equal to the surcharge they take from the retailer is better for all except the big credit card companies. Customers can use cash without subsidising the credit card users, credit card users can still use credit cards but they won't get ahead vs cash, retailers don't have to absorb the surchage (and ultimately partially pass it on to cash customers).
brainwad 2y ago
Nope, in Australia this is now the law and it hasn't stopped the CC duopoly at all. In fact it seemed to benefit it, as small merchants who used to not accept cards for small payments now just don't care since they pass the fees on to the customer. It turns out that most people just don't care about a 1% surcharge.

rootusrootus 2y ago

That seems like it would get complicated fast. Doesn't cash have its own additional handling costs that don't apply to credit card users? I'm not sure it's as easy as saying cash users are subsidizing anyone else.

BJones12 2y ago
For businesses to deposit cash at RBC (the largest Canadian bank) here's an account that charges $2.50 per $1,000 (branch), $2.25 per $1,000 (ATM) https://www.rbcroyalbank.com/business/accounts/flex-choice-business-account.html https://www.rbcroyalbank.com/business/accounts/flex-choice-b... Which is ~0.25%. Presumably a cash register also has some amortization on it.
- nazcan 2y ago
  That does not include the cost of staff processing it.
  - miki123211 2y ago
    And the cost of staff pocketing some of it, and the cost times risk of it being stolen, and the psychological impact to employees of the store being worth robbing...
    - felixg3 2y ago
      You forgot cash pickup and delivery costs for big stores or sending two employees to the bank with the day’s revenue (that’s the cost a lot of cash-only merchants in Germany usually don’t calculate for). Also don’t forget the counting of the day’s cash, two employees 30 minutes each.
- Teever 2y ago
  That sounds like something that could be regulated away if the government felt like it.

robocat 2y ago

edited: ignore this comment please, I totally misunderstood the comment! > Pass a law that credit card surcharges MUST be added onto the final price. You must be a rich person that supports monopolies! And clearly you know nothing about low margin retail businesses. If your profit margin is 5% and the credit card fees are 2.5% then you are saying profit should be split 50%/50% with Visa/Mastercard. In New Zealand originally the contract between the credit card company and the marchandiser said that the marchandiser couldn't charge a different amount for cash - an indirect way to force retailers to soak up the credit card fees. That clause was eventually outlawed here, for good reason. Your suggestion is to write the opposite law! The extra fees for credit cards are great. It is the customer's choice to pay them or not!

AnotherGoodName 2y ago
That’s exactly what I’m proposing though. Right now it’s cheaper to pay by credit card because I don’t pay the surcharge directly, it’s paid by all customers including cash customers. I have no choice but to pay by credit card. My proposal above is exactly what is required to make cash a choice. Btw did you read some idea that the surcharge applies to all purchases? The idea of charging the credit cards a surcharge equal to the surcharge they take from the retailer is better for all except the big credit card companies. Customers can use cash without subsidising the credit card users, credit card users can still use credit cards but they won't get ahead vs cash, retailers don't have to absorb the surchage (and ultimately partially pass it on to cash customers).

brainwad 2y ago

Nope, in Australia this is now the law and it hasn't stopped the CC duopoly at all. In fact it seemed to benefit it, as small merchants who used to not accept cards for small payments now just don't care since they pass the fees on to the customer. It turns out that most people just don't care about a 1% surcharge.