passing 3% credit card fees onto the customer?

[Gbirk]

Last I heard, charging a fee to use a CC was not legal. Like gun laws though, only the law abiding seem to take notice.

Used to be, but in most stares it is perfectly legal now.

Are credit card surcharges legal?

Though the practice of surcharging was outlawed for several decades, a class action lawsuit in 2013 permitted merchants in several U.S. states to implement surcharges in their businesses. This lawsuit started a chain reaction over the next several years with more and more states adopting a pro-surcharging stance. Proponents of surcharging have argued that anti-surcharging laws drive up prices for goods and services across the board, and in some cases may even be a violation of the First Amendment.


As of March 2021, most U.S. states allow merchants to surcharge on credit card transactions, with only Colorado, Connecticut, and Massachusetts having laws against surcharging.

 

[Member 66129]

Used to be, but in most stares it is perfectly legal now.

Are credit card surcharges legal?

Though the practice of surcharging was outlawed for several decades, a class action lawsuit in 2013 permitted merchants in several U.S. states to implement surcharges in their businesses. This lawsuit started a chain reaction over the next several years with more and more states adopting a pro-surcharging stance. Proponents of surcharging have argued that anti-surcharging laws drive up prices for goods and services across the board, and in some cases may even be a violation of the First Amendment.


As of March 2021, most U.S. states allow merchants to surcharge on credit card transactions, with only Colorado, Connecticut, and Massachusetts having laws against surcharging.

Well alright then. The more you know!

 

[Alexx1401]

Well alright then. The more you know!

When law makers started trying to "fix this", it went like it almost always does when they try to fix something because some whine about it. In anyplace they managed to stop this all they did was make those who do not use a CC pay for those who do. As far as I know its still against the terms the business agrees to when they sign up to take plastic. So far none of the banks wanted to push it and just loose the money so they let them go.
I had heard that at one time there was supposedly a law against this but never looked at how it worked. Have to guess it must have been poorly written as gun shops here have done this for as long as I can remember. Too lazy to look it up but I would have to guess it must have gone something like price on this gun is $299.00. I you pay cash we take 3% off. So it was not a "surcharge" it was a cash discount. Never really paid much attention as I just never cared. When I went in to buy stuff from them I just brought cash since I knew they gave me a better price.

 

[oremike]

On a side tangent the fee that torques my wing nuts is the document fees a car dealer charges to do the paper work and take it to DMV. Isn't that part of selling a car and when they take the paperwork to DMV don't they take a batch in at the same time? Shouldn't the fee be divided by the number submitted?

 

[Alexx1401]

On a side tangent the fee that torques my wing nuts is the document fees a car dealer charges to do the paper work and take it to DMV. Isn't that part of selling a car and when they take the paperwork to DMV don't they take a batch in at the same time? Shouldn't the fee be divided by the number submitted?

Its a way to make some money. Many places play this game with shipping and handling fee's. It's why when I am ammo shopping at a place I have not used its always a red flag when they will not tell you what the shipping is up front. While back I needed a new antenna for a scanner. Guy at work showed me one that worked super well. I went to order it and almost got taken. The antenna, mount, and cable were about $50, which was a little high but, I was willing to take it. Almost hit order when something caught my eye. Total order was now almost $100. They were trying to charge me $45 shipping and handling, USPS. For something that would cost them a few bucks to send. I backed out of it and found the antenna on Ebay far less with real shipping cost. Bought the mount and cable on Amazon. I have to guess the first place does manage to snag a lot of people who pay them that $45. I will of course never use them but, free market and all.

 

[03A3Sporter]

There should be a benefit to using cash.

Yes there should , additionally I can get a pretty healthy discount from a couple businesses here when I show up with cash versus them running my card

 

[03A3Sporter]

Its a way to make some money. Many places play this game with shipping and handling fee's. It's why when I am ammo shopping at a place I have not used its always a red flag when they will not tell you what the shipping is up front. While back I needed a new antenna for a scanner. Guy at work showed me one that worked super well. I went to order it and almost got taken. The antenna, mount, and cable were about $50, which was a little high but, I was willing to take it. Almost hit order when something caught my eye. Total order was now almost $100. They were trying to charge me $45 shipping and handling, USPS. For something that would cost them a few bucks to send. I backed out of it and found the antenna on Ebay far less with real shipping cost. Bought the mount and cable on Amazon. I have to guess the first place does manage to snag a lot of people who pay them that $45. I will of course never use them but, free market and all.

The problem us you are only considering them putting it in a box / envelope and sending it on , most businesses are slicing the margins thin so these days that they are charging the handling part of shipping and handling more accurately.

Competing with Amazon is hard to do when you are a small business ...

 

[Alexx1401]

The problem us you are only considering them putting it in a box / envelope and sending it on , most businesses are slicing the margins thin so these days that they are charging the handling part of shipping and handling more accurately.

Competing with Amazon is hard to do when you are a small business ...

That's fine with me, I have zero problem with a person making a buck. Charging $45 to ship me a 50$ item is not them making a buck but, I am not asking for law makers to step in. I could care less as I will just never deal with them. If I had not noticed and hit the buy button I would have been mad but only at myself for not paying close enough attention to the total before I told them to charge my card. The place I bought the same item from off E-bay sold the item for about $10 less, its a common China made item, and their shipping was less than $10. I am sure they are making money off the sale or they would not be in business. Only reason I bought the mount and cable off Amazon not the people who sold the antenna was they did not have in stock the one I wanted. Would have been glad to let them sell me all the parts of they had it.

 

[03A3Sporter]

That's fine with me, I have zero problem with a person making a buck. Charging $45 to ship me a 50$ item is not them making a buck but, I am not asking for law makers to step in. I could care less as I will just never deal with them. If I had not noticed and hit the buy button I would have been mad but only at myself for not paying close enough attention to the total before I told them to charge my card. The place I bought the same item from off E-bay sold the item for about $10 less, its a common China made item, and their shipping was less than $10. I am sure they are making money off the sale or they would not be in business. Only reason I bought the mount and cable off Amazon not the people who sold the antenna was they did not have in stock the one I wanted. Would have been glad to let them sell me all the parts of they had it.

a lot of your power sellers on ebay now are drop shipping and are not actually carrying goods. It's a good and bad thing , I have benefited from the low price but when I have been fored to return the item its been a nightmare , last item I purchased on ebay the seller was located in Maryland but the item shipped from a warehouse in OKC .

 

[oremike]

When I ship I don't charge handling fees only as close as I can guess to the shipping fees.

 

[Alexx1401]

a lot of your power sellers on ebay now are drop shipping and are not actually carrying goods. It's a good and bad thing , I have benefited from the low price but when I have been fored to return the item its been a nightmare , last item I purchased on ebay the seller was located in Maryland but the item shipped from a warehouse in OKC .

Don't know all the ins and outs, don't really care. When I want something I just order it. Have been REAL big on ordering stuff since before the net. Never have liked driving around to stores to find what I want. I AM NOT a fan of Jeff due to how he uses his money sadly. He was for many years my go to first place. Now he is my last choice. It's why I went looking someplace else for that antenna and Jeff was my last choice. Not that he cares that he has lost some of my money I'm sure.
If anyone else is needing an antenna for something the place was called "The antenna Farm". Service was great.

 

[Stomper]

Last I heard, charging a fee to use a CC was not legal. Like gun laws though, only the law abiding seem to take notice.

Not true… see gas station cash/debit prices, and then CC prices? It's usually 10¢ a gallon more.

 

[DirectDrive]

On a side tangent the fee that torques my wing nuts is the document fees a car dealer charges to do the paper work and take it to DMV. Isn't that part of selling a car and when they take the paperwork to DMV don't they take a batch in at the same time? Shouldn't the fee be divided by the number submitted?

Yep.
This is a sneaky way some dealers increase their profit.
It's best to be aware of "doc fees", "prep fees" etc and negotiate them either down or out early in the buying process.
What's my "out-the-door cost" ? And have them break out every item.

 

[DirectDrive]

I'm confused.
If I use plastic it leaves a paper trail, if I use cash it doesn't.
Seems backwards.

If you use cash :

1) You give up the Buyer Protection that a CC provides
2) You leave money on table
I get a free gun at least once a year with my 2% on everything cash back card
3) You're probably a geezer



Pro Tip :
Don't use a CC if you can't pay in full each month.

 

[billdeserthills]

Last I heard, charging a fee to use a CC was not legal. Like gun laws though, only the law abiding seem to take notice.

My credit card processor doesn't mind if I charge a fee but first I have to submit the fee & they get to review it.

I personally find it leaves a bad taste in my mouth to charge a fee but I have had to when selling my products at very low mark-up

 

[Alexx1401]

Not true… see gas station cash/debit prices, and then CC prices? It's usually 10¢ a gallon more.

I am guessing this was done the same way gun shops were doing this at that time. Giving a price and saying discount if paid cash or their in house card? Never really paid much attention when this was being faught by chest thumping law makers. Just never cared. When they came out with the pump you could pay at instead of going inside I was glad to pay the few cents to just pay at The pump.

 

[Rkangel]

The 3% is the minimum that businesses are charged by credit card processors. However, every time a customer uses their Cabellas card, airline miles card, or other rewards cards, businesses are charged 6% or more (guess who pays for those frequent flyer miles and rewards points - they aren't free). That is a significant cost of doing business if profit margins are 5-10%. If a business sells a low margin item and gets charged more for the processing fee than they make on the item, it is not a good way to stay in business.

So, what is better?
-Charge the credit card fee to the customer who pays with a credit card?
-Increase the price everyone to cover the cost of credit card fees?

Anyone remember when gas stations used to charge more for credit cards? They didn't get rid of those charges, they just added a couple cents per gallon for everyone.

 

[Tony617]

The 3% is the minimum that businesses are charged by credit card processors. However, every time a customer uses their Cabellas card, airline miles card, or other rewards cards, businesses are charged 6% or more (guess who pays for those frequent flyer miles and rewards points - they aren't free). That is a significant cost of doing business if profit margins are 5-10%. If a business sells a low margin item and gets charged more for the processing fee than they make on the item, it is not a good way to stay in business.

So, what is better?
-Charge the credit card fee to the customer who pays with a credit card?
-Increase the price everyone to cover the cost of credit card fees?

Anyone remember when gas stations used to charge more for credit cards? They didn't get rid of those charges, they just added a couple cents per gallon for everyone.

The gas stations I see are for cash but they charge 10 cents more per gallon if you use a credit card. At least here in Washington State. But I don't drive into work yet so I am still working from home so my gas use is not that much. I do drive my car sometimes otherwise by battery discharges enough that I cannot start my car. I have a car alarm built in my vehicle so it take some power to run all of the time when I leave my car sitting in the driveway for two or three weeks. I suppose I could disconnect my battery but I would have to open the hood and reattach the cable before I could drive.

 

[pogi]

The problem us you are only considering them putting it in a box / envelope and sending it on , most businesses are slicing the margins thin so these days that they are charging the handling part of shipping and handling more accurately.

Competing with Amazon is hard to do when you are a small business ...

Most people do not understand that 3-5% profit is typical. My dad always told me that 10% profit was amazing.

I would rather put that 3% CC fee back in the mom & pop shop owners with cash. Hopefully they no sale that bill and pocket the cash too.

 

[Alexx1401]

The 3% is the minimum that businesses are charged by credit card processors. However, every time a customer uses their Cabellas card, airline miles card, or other rewards cards, businesses are charged 6% or more (guess who pays for those frequent flyer miles and rewards points - they aren't free). That is a significant cost of doing business if profit margins are 5-10%. If a business sells a low margin item and gets charged more for the processing fee than they make on the item, it is not a good way to stay in business.

So, what is better?
-Charge the credit card fee to the customer who pays with a credit card?
-Increase the price everyone to cover the cost of credit card fees?

Anyone remember when gas stations used to charge more for credit cards? They didn't get rid of those charges, they just added a couple cents per gallon for everyone.

Gas stations still do here at least. Price on the sign is cash or their in house card. If you want o do what I do, pay at the pump its more. Never pay attention as I just do it because it's easy. Don't want to have to walk inside to save the few cents. I guess if I was buying hundreds of gallons at a time I would bring cash or bother to get one of their cards. Since normally I am buying around 8 gallons have not bothered.