Retailers charging transaction fees

[geeky]

Unreal. 15 posts and not one pointing the finger at the real motherfuckers in this scenario. You wanna be pissed at someone, be pissed at the goddamned banks, not the mom-n-pops getting squeezed by them.The fucking banks charge the poor saps a cut for processing a debit card purchase, and the fucking soulless motherfuckers at the banks have been upping fees nonstop. I don't begrudge some pinched retailers adding a service fee. (I also ain't a fan of paying more, so Imma happy to pay cash or use a credit card instead)

Yes... god forbid the banks charge retailers a fee for using their payment processing systems. Clearly, banks should be giving this service available for free. I don't see why their shareholders would have any issue with that.

I'm not a huge fan of paying fees as much as the next guy, but to suggest that for-profit companies should give away services is a little naive. The reality is that if the mom-and-pop store don't have the margins to afford the processing fees for credit and debit cards, they should probably just accept cash.

 

[zefroggy]

I love these discussions.

Debit is really cheap to accept for merchants and is a transaction fee. Usually between $0.01 (large chains) and $0.15. Some poor sap may be getting ripped off by ISOs and it's a different discussion.
Credit is an interchange rates calculated in percentage with a base rate and variation depending on the type of cards.

Some light reading:
Visa: http://www.visa.ca/en/aboutcan/mediacentre/interchange/pdf/visa-interchange-rates-current.pdf
MasterCard: http://www.mastercard.com/ca/wce/PDF/Interchange_Table_for_Website_for_17_April_2015.pdf

As for the surcharging, until recently it was only allowed on debit (with the exclusion of Quebec) and the money is pocketed by the merchant. For example, the pizza delivery debit surcharge goes to the store. With the new credit and debit code of conduct things are going to get more interesting since now the government open the door to the discount and surcharge circus with the following:
5. Payment card network rules will ensure that merchants will be allowed to provide discounts for different methods of payment (e.g. cash, debit card, credit card). Merchants will also be allowed to provide differential discounts among different payment card networks.

Discounts will be allowed for any payment method. As well, differential discounting will be permitted between payment card networks.

Any discounts must be clearly marked at the point-of-sale.
[Source: http://www.fcac-acfc.gc.ca/Eng/forIndustry/publications/lawsReg/Pages/CodeofCo-Codedeco.aspx]

As an insider, I use my credit card as much as possible unless I can get a discount for paying debit (just ask for it on anything over $500 and the smart business owner will take my debit card over a Visa Infinite with 4%+ interchange any day) or I am shopping at one of my local store and don't have cash.

And to find out the real culprit, just follow the money:
Visa Inc valuation: https://www.google.ca/finance?q=visa+inc&ei=uZReVbqlJYmUqAGQm4HYDA
MasterCard Inc valuation: https://www.google.ca/finance?q=mastercard&ei=v5ReVaDRGZGlqwHhu4LgAQ

 

[herbnessman]

It's a peeve of mine as well. I have occasionally walked out on retailers when it is clearly just gouging. I can accept it when they have a spend threshold (ie transactions under $5) otherwise it is just needlessly passing on a cost of doing business to your customer.

I generally use credit card to avoid it as the card companies specifically disallow surcharges as part of their merchant agreements.

 

[Liber Pater]

Use cash before the Man takes it away from us. I would think this audience would be the most receptive to the thought.

 

[1HandInMyPocket]

...Now, I appreciate the business owners have to cover their banking charges, but I would be really surprised if the banks charge that for every interac purchase....

How do others feel about this?

Yes, business do get charged for EVERY interac purchase. Mom and pop stores (like my parents) pass that charge onto the customer. And here is something that might also surprise you, they sell items above what it cost them as well.

Big business like Walmart and Costco, can obviously cover these costs. For me, I prefer to support smaller businesses when I can.

I love these discussions.

Debit is really cheap to accept for merchants and is a transaction fee. Usually between $0.01 (large chains) and $0.15. Some poor sap may be getting ripped off by ISOs and it's a different discussion.

I suppose those figures are for bigger retailers. Stand alone stores will get charged a minimal of $0.15, more if they go with one of the big 5 banks, which is why small stores don't usually have debit machines from banks.

 

[zefroggy]

I suppose those figures are for bigger retailers. Stand alone stores will get charged a minimal of $0.15, more if they go with one of the big 5 banks, which is why small stores don't usually have debit machines from banks.

CFIB rates example below is $0.05. All 100k members can get get it.
http://www.cfib-fcei.ca/english/art...ates-payment-processing-chase-paymentech.html

York U is $0.08
http://www.yorku.ca/finance/divisions/documents/Moneris_Fee_Schedule.pdf

The large retailers or chains pay below a cent. So don't worry about them.

By the way, this is the one service you want to get from the big guys like Moneris, Chase, First Data or Global Payments. All the other guys are just resellers of their services.

 

[oldjones]

We can pretend we're getting something free — like those 'free' shopping bags — by rolling the charge into the price and forgetting its there. Or we can helplessly watch our cash whittled away by unavoidable 'convenience fees' and 'transaction charges' and HST that we see on the bill. But either way, we pay the same bottom line.

As the anti-bag boys have pointed out, the separate charges and line items are just a way to raise the amount we pay, while shifting the blame to someone far away who isn't listening.

If the buyer has a choice — like whether they want/need a bag — make it a line item; otherwise it's just what ya gotta pay and should be in the price.

Tax included.

 

[punter]

Then why not use credit card, instead?

 

[SkyRider]

Then why not use credit card, instead?

Many of the smaller stores don't accept CC or only accept CC above a threshold amount. Then there are people who can't get a CC, unless it is a prepaid CC, because............................

 

[punter]

Many of the smaller stores don't accept CC or only accept CC above a threshold amount..

I hear you. There are only a handful of shops/restaurants that I go to that will not take CC. Needless to say, I don't go to them very often. 10 years ago, few Chinese restaurants would take CC, but now many of them do.

 

[TeeJay]

Argue with the store clerk when they try to pull that fast one
It violates service terms (you can even call Moneris to report them if they insist)

 

[asuran]

If you don't like it, shop elsewhere.

Use that extra bit of gas to go to another place. Either way someone is getting our money, might as well be the petroleum corporations.

 

[Twister]

I remember some computer store were charging 3% more for credit cards because the CC companies were charging the merchant 3%. I don't know if its the same.

 

[good to go]

Go to the bank complain about waiting for a teller and take out your cash each week for pocket money. Do not use debit or credit and they will not have your money to use to make more money.

 

[fuji]

There are two convenience stores near me, one charges a fee on credit card purchases under $5 and the other doesn't.

I have always just paid the fee and can't imagine arguing about it, but after paying the few a couple of times and noticing the difference I now consistently go to the store that doesn't charge it.

Silly in a way because the fee is pretty small and hardly worth saving but since both stores are equally convenient I do actually go to the cheaper one.

 

[saxon]

Stop complaining and jump on the bandwagon. I've got TD and Royal Bank stock as well as VISA. If your mad about getting hosed by the banks and credit card companies just buy their stock and make yourself a good buck. It'll make you feel better.

 

[TeeJay]

Many of the smaller stores don't accept CC or only accept CC above a threshold amount. Then there are people who can't get a CC, unless it is a prepaid CC, because............................

In this day and age everyone accepts cards
You can even get iPhone apps with a reader etc for the smallest of businesses

 

[TeeJay]

If you don't like it, shop elsewhere.

Use that extra bit of gas to go to another place. Either way someone is getting our money, might as well be the petroleum corporations.

I could make the same argument about the fucks who price match things like bananas at the local Wal-Mart over a nickel

 

[saxon]

Government of Denmark is drafting legislation to allow businesses to refuse to accept cash and take plastic only. They are eventually going to a cashless society. At some point we will all end up using something other than cash to make our purchases.

 

[rhuarc29]

Now, I appreciate the business owners have to cover their banking charges, but I would be really surprised if the banks charge that for every interac purchase. I also see paying by cash more expensive for the business owner, because they have to take time and gas to go to the bank, then pay up to 2.5% to deposit it.

Uh, trust me: they already frequent the bank for other business-related reasons. It's not out of their way. And I'm not sure what this 2.5% fee is you're talking about.

Regardless, it's a stupid practice to charge your customers a transaction fee so blatantly. They'd be better off burying it in the cost of goods. However, I prefer it this way because I never pay with debit...so cheaper for me! I think the last time I used my debit card to make a purchase was when I was in high school!