It is a bad outcome. The high amex fees put up the price of coffee for all customers. Amex are making money from customers they don't even service. It's a scam and the business owner should encourage the customer to pay cash if possible.

Wife and I own a brick and mortar service based business with recurring revenue. Credit card customers get a 3% transaction fee added while ACH we swallow the 1% cost. I don't believe the terms of services says we can do that. I doubt Visa will send someone to investigate. If we didn't, we would need to increase prices for everyone.

(Our ACH used to be cheaper but Intuitwants to squeeze small business owners :https://quickbooks.intuit.com/learn-support/en-us/payments/a... )

Interesting! Would it be possible for you to not accept credit card but accept ACH?

No, I mean we don't mind offering it if they pay the fee. Customers have different reasons for preferring credit cards.

Maybe they honestly can't afford it and need to use it for the credit aspect.

Some aren't comfortable with automatic withdrawal from their checking account.

Some it's just a habit and don't use checking accounts.

I'd say about 15% pf customers would rather take the fee.

The normal cash back on a card is 1% and some even higher so to them its not that big of a deal...but to a business it ads up.

Our profit margin is about 20% of sales. If we gave up 3% of sales, that is taking away 15% of our profits!

To give example numbers, if we charge $100 per month we pocket $20 after expenses (rent, payroll, etc)...but If we swallow the credit card fees that's $3, and makes the profit down to $17. So after all this hard work of customer acquisition, providing services etc, such a little thing takes away 15% of our profits (and that's before it passes through to us as income tax!).

ACH used to be a flat $.50 per transaction...it takes time to reconcile invoices and payments so right now just sucking it up.

I remember going to a restaurant in Belgium-Bruges(in 2015) that had the fees listed at every table. They were charging you the table cost + whatever fees were listed for your card. While I can't remember the fees I do remember that is was enough to make me decide I want to pay cash.

I don't know if it's legal or not to do that but I found it an interesting quirk of the times we're in (and maybe the owner was pissed off).

Afaik it's not legal anymore to do this in Germany (and probably Belgium/EU?), or rather: It's illegal for the businesses to have different prices for different payment methods (a workaround are coupons for using certain payments, but probably only for special offers). As far as I remember PayPal was usually the most expensive payment method (compared to CC, bank transfer etc.).

Interesting Australia went in the opposite direction: per-type fees are A-ok, but they have the be the true fees.

The problem was that vendors tended to make arbitrary minimum fees for using cards which in no way reflected the actual fees they were paying. Smaller stores were steering customers to cash as it was easier to under-declare earnings with cash. In response Amex in Australia reduced their fees to stores while simultaneously reducing the value of their awards points programmes (since those were ultimately funded by the fees being charged.)

This also plays into application stores - since developers often don’t pass on fee reductions (such as the subscription fee reduction of 30%->15% after 1 year.)

I’m so confused. The ruling agrees with you?

Edit: nope I was wrong, I read it the other way.