Any payment/money movement system needs a license and you’re still bound by federal rules on AML and KYC. It makes it hard to support the cannabis industry. AML laws will force you to report large cash movements.
The $30 wire fee is what a bank charges you to make money and dependent on the bank. Underlying systems near free to use like ach for domestic wires.
I see this all the time. * At more than one bookstore, the dry cleaner, markets, my current and previous landlord, my accountant, and pretty much every gas station since the 1990's.
* Pre-quarantine. Now I don't see anything.
Gas stations I find weird, in general. How did they get that exception?
Some gas stations where I live have a "credit" price and a lower "cash" price.
The above poster was incorrect.
(2) Credit surcharges and minimums used to be forbidden, but they are not anymore ("2% surcharge for paying with credit, minimum $10 for card payments")
(3) It wasn't federal law, it was the merchant agreements that precluded credit card minimums and surcharges as a condition of signing up to accept credit card payments from each of the major issuers.
> You also can't say "$1.99 + 20 cents processing charge" - no, the price must be listed including charges. (Notice that nobody every does this?)
We see these a lot in Australia. I wish they'd enforce the same pricing here for cash and card — I don't like to carry cash around, and I hate it that I have to pay a surcharge when paying by card.
https://www.accc.gov.au/consumers/prices-surcharges-receipts...
A Visa or MC credit or debit card txn go via the Visa or MC networks.
An EFTPOS txn goes via the EFTPOS network, it's much cheaper.
In AU, the fees are regulated and must be disclosed to the user as an extra charge. Most businesses much prefer the EFTPOS network because it's much cheaper.
Until recently, the contactless environment didn't support EFTPOS, so it always used the Visa or MC networks. Same applies to Google and Apple Pay.
If there is no price differentiation, this just means everyone has to share the cost, rather than the people who choose to use it
So you think your use of a credit card should be subsidized by people who pay in cash?
Cash is not free for a store to handle. Stores pay transaction fees on credit cards, sure, but they save on all the costs of cash. A hypothetical store that takes credit cards only would not have any of these costs and their vulnerability to robbery/theft would be limited to merchandise and capital only, saving the cost of insurance against theft of cash. For some types of businesses (services rather than retailers), this makes their office a pretty unattractive target for burglars and eliminates employee theft of cash.
Stores generally try to give extra charges for using credit cards, not the other way around.
It seems like the fair thing to do, should be to allow a store to do whatever it wants, and make these credit card requirements illegal.
So, it would be allowed for stored to charge extra for either cash or credit, whatever they choose, and the credit card companies would be forbidden from stopping this.
It's common for online stores to charge a few percent extra for credit card payment (the base price usually applies for the most common form of online payment, iDEAL, which is cheaper, I guess because the banks cut out Visa/MC).
On the other end of the spectrum, there are some physical stores and restaurants (usually chains) that don't accept cash. They're allowed to do that, given that they state so very clearly upfront.
that's like saying opening the doors everyday to customers is not free. it's true, but misses the point. handling cash, like paying for utilities, is a fundamental cost of doing business, and so it should be, because the right to anonymity and privacy is woven into cash. not so much with electronic transactions, which are optional, alternative costs.
(Especially when the cost between different payment mechanisms differ a lot.)
It just happens that they dont want to do that, because dealing with cash is cheaper
One small cafe near a place I used to work said it usually took 30-60 days for funds to clear into their account after a card transaction. That, for them, was a major problem as it meant that they couldn't then pay their suppliers in a timely manner when cashflow was highly variable.
Then again, a bakery I visited that was in a small town said they'd stopped taking cash, as they got robbed some huge number of times.
I don't think it should be so clear cut like that. The credit card processing fees charged by the processor is a cost of doing business and should just be factored into the pricing without being explicitly passed on to a subset of customers. For example, a shopping centre or convenience store may have toilets that only a subset of customers would use. Should the customers who bought something without using the toilet be "subsidising the cleaning costs"? If a store offers online ordering, should customers who ordered online be "subsidising the rent of the physical store"?
It's a valid business decision to NOT charge extra for the toilets, too. Just like shops usually don't charge people who are a bit slower in the checkout line more for taking up cashier time.
https://en.wikipedia.org/wiki/Expressions_Hair_Design_v._Sch...
Plus, plenty of gas stations show a cash/credit price on their signs.
The merchants are no longer allowed to block this behavior.
But that's only if you pay by cash, you don't get any point by paying by card.
The place I went to yesterday for lunch did this. This is in Silicon Valley. I believe it was a 3.9% credit card fee.
The fraud protection of credit cards mostly comes out of the pockets of the merchant, I think? So the merchant could give people a discount for using means of payment without a chargeback, like cash.
You are right about the actual credit. Though eg in Germany people usually use their overdraft in a same way that American seem to be using their credit cards for short term credit.
(For either convenience is the main selling point. The fees and interest rates for overdraft and credit card debt are usually quite high, I think?)
Yes, but in reality, the program comes from an upside down approach to overcoming the obviously anti-competitive practices that VISA/MC use to forbid retailers from offering discounts for not using VISA etc..
You can't say "Get 2% if you use cash instead of VISA". (Notice that nobody ever advertises that?) Because VISA doesn't allow it.
You also can't say "$1.99 + 20 cents processing charge" - no, the price must be listed including charges. (Notice that nobody every does this?)
But you can possibly find ways to give points, or 'cash-back'.
Until now ... [1]
VISA is now saying that even such 'cash back' rewards programs are a violation of its rules.
Have a look at the press release - it's positively Orwellian:
"In order to maintain a level playing field" -> "In order to avoid all transparency and maintain our hidden monopoly" we require that nobody can take steps which highlight the how our transaction fees are embedded in the price.
These are pretty blatant anti-competitive practices and taking them on is tantamount to taking on the entire banking system. It's not going to happen.
There would need to be an 'outside disruptor' like the Word Processor to the Typewriter kind of thing.
[1] https://www.pymnts.com/visa/2018/non-compliant-cash-discount...