This is stipulated at the bottom of its invoices, and this does give notice. But I can't believe such an arbitrary action can be legal.
2007-02-03 12:26:48 · 9 answers · asked by mitch118 1 in Business & Finance ➔ Small Business
It is legal. They are charging you what they are getting charged by the credit card companies for the business to use the services of the credit card company. Every credit card company has a service fee for the use of their credit cards through debit machines, for processing and paperwork done for each transaction.
2007-02-03 12:36:17 · answer #1 · answered by dragondave187 4 · 0⤊ 1⤋
Visa and Mastercard strictly prohibit this practice.
Yes, the credit card companies do charge the business a certain percentage for credit card transactions. However, this is the cost of using their services, and should not be passed on to the consumer.
Haven't you ever noticed cc promotions, where you can only "win" or gain points by signing for your transaction rather than using a pin-based card? That's because the cc company is making money off of it.
However, a number of sites I researched say it's legal to charge a fee for using a debit card. But I'm no expert.
2007-02-03 12:34:41 · answer #2 · answered by Anonymous · 0⤊ 0⤋
Course its legal. Why would it not be. Credit card processors charge businesses 1-5% depending on the card and the volume of business the business generates. There is nothing that requires them to accept credit cards so why would it be an arbitrary action for them to pass the additional cost on to you.
Years ago Gas Stations use to charge different prices for Cash or Credit. Have you never heard of "Same price Cash or Credit"?Even utility companies add surcharges for certain cards.
And all these other people saying it violates mercahant agreements and only for governmental agencies like the IRS are morons!!
2007-02-03 14:04:41 · answer #3 · answered by SNCK 3 · 0⤊ 1⤋
It is legal, and it's far from arbitrary, especially if the business is small and doesn't process alot of credit card orders. Businesses that accept credit cards are assessed subscription fees for accepting cards, as well as a percentage of the amount spent for each transaction.
The reason it may seem arbitrary is that most businesses that accept credit cards for payment are much larger, or process larger volumes of credit cards, and pay less to the credit card networks per transaction, and are able to just "cough up" the fees themselves.
In any case, the fees get paid, whether or not you actually see them on your bill. Most businesses simply raise their prices slightly to avoid having their customers notice that it actually COSTS MONEY to process credit card orders.
P.S. - This is why debit cards are a good business for banks and major credit card networks to endorse.
2007-02-03 12:38:38 · answer #4 · answered by W3TOD 2 · 0⤊ 1⤋
It is not against the law. However, as other posters have said, you can be almost certain that it breaks the terms of the agreement the merchant has with the credit card and processing companies.
The only times that I am aware of that the credit card companies have agreed with the merchant that the merchant can charge extra for credit card processing is when the merchant is.....the IRS or other governmental agencies.
2007-02-03 12:47:43 · answer #5 · answered by Take Responsibility 2 · 1⤊ 0⤋
Gas stations do this as a pretty common practice. If you ever saw the reader sign that showed different "cash" and "credit" prices, then you are seeing the same practice.
Stores can set whatever prices for their merchandise that they want. The reason this one is asking for more money when pauid by credit is because the credit card company only pays 90 to 97% of the retail price to the retailer.
2007-02-03 12:35:59 · answer #6 · answered by chocolahoma 7 · 0⤊ 1⤋
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2016-10-01 09:31:21 · answer #7 · answered by ? 4 · 0⤊ 0⤋
It is legal, but it is against visa/mastercard agreements. Call your credit card company and report them. They will get it changed.
2007-02-03 12:31:27 · answer #8 · answered by NYC_Since_the_90s 6 · 0⤊ 0⤋
yes. the 3 percent is what the credit card company charges them so they are just passing the cost back to you .
2007-02-03 12:31:25 · answer #9 · answered by george 2 6 · 0⤊ 1⤋