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Six months ago I was at a burrito place and saw as I was paying that there was a new 3% fee for paying with a credit card. I have not gone back there since. As

Six months ago I was at a burrito place and saw as I was paying that there was a new 3% fee for paying with a credit card. I have not gone back there since. Asking $11 for a burrito was already iffy and by then I'd started to curtail fast food purchases. I can't even imagine paying an 18-20% fee that isn't meant to be the entirety of the tip.

Buttons840 2y ago
The Visa terms of service forbid charging extra for payments using a Visa. Other credit cards have similar terms I think.
- bdangubic 2y ago
  exactly. you’d get banned from visa and then you may as well close the shop
- add-sub-mul-div 2y ago
  Yeah I thought there was some kind of rule like that which is why I was so surprised, I'd never seen it in food service before.
- PlunderBunny 2y ago
  Those particular Visa terms of service eventually got shot down in New Zealand - now many POS terminals/cashiers will tell you that there’s an additional charge for credit cards [0] (Also, no tipping in New Zealand, except for a few restaurants close enough to the cruise ships that they think their customers won’t know any better). 0. https://www.cab.org.nz/article/KB00000071 https://www.cab.org.nz/article/KB00000071
TheDong 2y ago
A 3% fee for a card makes perfect sense to me. That's not far off from what the merchant is losing for credit card customers, so their options are: 1. Charge the same for credit cards as cash, and make cash paying customers effectively pay more, thus applying a regressive tax to the poor (who are less likely to have credit cards) 2. Charge more for the credit card paying customers, and they can avoid this extra payment by paying with cash. 2 is obviously better, and I would rather go to stores that take 2 than ones which choose to charge everyone more, effectively to the detriment of those worse off.
- rootusrootus 2y ago
  If you charge 3% just to credit card users, they are now subsidizing the cash customers. I am guessing you are assuming the cost of cash handling to be zero.
  - cute_boi 2y ago
    well they must take cash anyway, so cost of handling cash isn't that significant compared to fixed+variable cost of credit card.
    - rootusrootus 2y ago
      There is no federal law requiring a business to accept currency. You may be in a local jurisdiction with such a law.
    - ac29 2y ago
      Its been a long time since I worked retail, but I remember the costs of cash handling to be quite a bit more than you might assume: -Count cash drawers in and out for every employee, every shift -Count cash payments received & change returned -Prepare daily bank deposits -Take daily bank deposits to bank, get more change I couldnt say exactly what percentage all of that adds up to, but I could see it being 3% or maybe even more.
  - FireBeyond 2y ago
    Not to mention, as someone who spent a few years in that industry, in many cases those cash customers are not getting reported to the IRS, or local authorities for sales tax. So they could already be "saving" up to 10% or more on cash customers...
- cute_boi 2y ago
  I think this will be solved once Credit Card Competition Act is approved. Cash isn't a solution.
- bdangubic 2y ago
  3% is the cost of doing business. you wanna charge customers for electricity too? what’s that - like 1% more? uniform / apron cleaning - 0.12%? anything else? :)

Buttons840 2y ago

The Visa terms of service forbid charging extra for payments using a Visa. Other credit cards have similar terms I think.

bdangubic 2y ago
exactly. you’d get banned from visa and then you may as well close the shop
add-sub-mul-div 2y ago
Yeah I thought there was some kind of rule like that which is why I was so surprised, I'd never seen it in food service before.
PlunderBunny 2y ago
Those particular Visa terms of service eventually got shot down in New Zealand - now many POS terminals/cashiers will tell you that there’s an additional charge for credit cards [0] (Also, no tipping in New Zealand, except for a few restaurants close enough to the cruise ships that they think their customers won’t know any better). 0. https://www.cab.org.nz/article/KB00000071 https://www.cab.org.nz/article/KB00000071

TheDong 2y ago

A 3% fee for a card makes perfect sense to me. That's not far off from what the merchant is losing for credit card customers, so their options are: 1. Charge the same for credit cards as cash, and make cash paying customers effectively pay more, thus applying a regressive tax to the poor (who are less likely to have credit cards) 2. Charge more for the credit card paying customers, and they can avoid this extra payment by paying with cash. 2 is obviously better, and I would rather go to stores that take 2 than ones which choose to charge everyone more, effectively to the detriment of those worse off.

rootusrootus 2y ago
If you charge 3% just to credit card users, they are now subsidizing the cash customers. I am guessing you are assuming the cost of cash handling to be zero.
- cute_boi 2y ago
  well they must take cash anyway, so cost of handling cash isn't that significant compared to fixed+variable cost of credit card.
  - rootusrootus 2y ago
    There is no federal law requiring a business to accept currency. You may be in a local jurisdiction with such a law.
  - ac29 2y ago
    Its been a long time since I worked retail, but I remember the costs of cash handling to be quite a bit more than you might assume: -Count cash drawers in and out for every employee, every shift -Count cash payments received & change returned -Prepare daily bank deposits -Take daily bank deposits to bank, get more change I couldnt say exactly what percentage all of that adds up to, but I could see it being 3% or maybe even more.
- FireBeyond 2y ago
  Not to mention, as someone who spent a few years in that industry, in many cases those cash customers are not getting reported to the IRS, or local authorities for sales tax. So they could already be "saving" up to 10% or more on cash customers...
cute_boi 2y ago
I think this will be solved once Credit Card Competition Act is approved. Cash isn't a solution.
bdangubic 2y ago
3% is the cost of doing business. you wanna charge customers for electricity too? what’s that - like 1% more? uniform / apron cleaning - 0.12%? anything else? :)