113 replies to this topic

[hegemony]

if the fees are too high simply insist customers use cash and don't accept any credit cards.

much better than pushing for regulations that distort the market

[frank22]

if the fees are too high simply insist customers use cash and don't accept any credit cards.

much better than pushing for regulations that distort the market

I am thinking you can't be serious. Come on your playing me, right?

[hegemony]

let's stop subsidizing unprofitable merchants.

[radi8]

let's stop subsidizing unprofitable merchants.

I'd rather stop subsidizing unprofitable banks.

[hegemony]

let's stop subsidizing unprofitable merchants.

I'd rather stop subsidizing unprofitable banks.

me too, but one windmill at a time

ETA: remember some banks were FORCED to take a subsidy...and paid it back as soon as it could to avoid the namby pambyland issues (e.g., amex)

Edited by hegemony, 22 July 2010 - 09:27 PM.

[radi8]

if the fees are too high simply insist customers use cash and don't accept any credit cards.

much better than pushing for regulations that distort the market

I am thinking you can't be serious. Come on your playing me, right?

I guess the banks colluding to fix prices for card processing isn't a market distortion. There hasn't been a "free market" at play here for years.

[frank22]

let's stop subsidizing unprofitable merchants.

I'd rather stop subsidizing unprofitable banks.

Much worse is subsidizing very profitable banks!

[hegemony]

if the fees are too high simply insist customers use cash and don't accept any credit cards.

much better than pushing for regulations that distort the market

I am thinking you can't be serious. Come on your playing me, right?

I guess the banks colluding to fix prices for card processing isn't a market distortion. There hasn't been a "free market" at play here for years.

no worse than dumpmart or other big box running ma and pa out of business and then jacking prices

but then, retailers can vote with their feet -- just don't take credit cards if such transactions are not profitable for you

[radi8]

[no worse than dumpmart or other big box running ma and pa out of business and then jacking prices

I'm OK with the Gubmn't sticking their boot up Dumpmart's backside as well. For largely the same reasons.

[BBQ123]

The market share for American Express is lower because American Express doesn't usually issue cards to people with subprime credit, whereas Visa/MC issuers make lots of money doing so.

[frank22]

The market share for American Express is lower because American Express doesn't usually issue cards to people with subprime credit, whereas Visa/MC issuers make lots of money doing so.

Also, Discover, and those are the only even nominal competitors. A big reason is the banks will not sign up with a new service co, and they definitely won't sign up with one unless they provide them with at least the fees they are receiving from Visa or Mastercard. They were sued, and did settle out of court for billions. You can't say Visa/Mastercard doesn't have and won''t exploit their market power. Do you think they paid those billions out for nothing?


75% market share where there is no downward pressure on prices is definitely a problem, as evidenced by the increasing fee cost, despite the reduced cost of the service due to efficiencies. The new rules is only taken a little power away. They still have quite a bit, you don't see any value in that, at all?

[hegemony]

The market share for American Express is lower because American Express doesn't usually issue cards to people with subprime credit, whereas Visa/MC issuers make lots of money doing so.

I wonder what effect the increasing number of banks and CUs issuing on the amex network will have.

[athensgaguy]

let's stop subsidizing unprofitable merchants.

I'd rather stop subsidizing unprofitable banks.

me too, but one windmill at a time

ETA: remember some banks were FORCED to take a subsidy...and paid it back as soon as it could to avoid the namby pambyland issues (e.g., amex)

Amex would have defaulted on their commercial paper without a bailout.

[athensgaguy]

Exaggerate much? There is no federal regulations that will give us or the merchants free credit card services, so you are rolling your eyes to your imagination. They are just allowing for a small amount of merchant and consumer control. This rule doesn't even regulate prices, never mind giving them to us for free. The merchants also didn't even get the ability to control the extra costs of the rewards products. Even after the rule they will have no choice but to pay the extra reward fees.

There is a debit card swipe fee pricing control included in the FinReg.

[athensgaguy]

they weren't going to do anything with minimums, but they were looking hard at offering a discount for cash.

I suspect that's how it will play out in a lot of places. No minimum for the card, but cash will get a discount. Most likely that "discount" will be the same price you are paying now- with the small-ticket items being marked up enough to cover the processing fees.
That 0.90 snickers will be $1.00, discounted back to 0.90 if you pay cash.

They can already give a cash discount as long as they specifically list their pricing.

[frank22]

Exaggerate much? There is no federal regulations that will give us or the merchants free credit card services, so you are rolling your eyes to your imagination. They are just allowing for a small amount of merchant and consumer control. This rule doesn't even regulate prices, never mind giving them to us for free. The merchants also didn't even get the ability to control the extra costs of the rewards products. Even after the rule they will have no choice but to pay the extra reward fees.

There is a debit card swipe fee pricing control included in the FinReg.

I knew that when I typed it but since we were discussing credit cards, I wanted to keep it on topic and try to make the post less wordy. I try to balance that out, and decided it wasn't relevant to the context. I disagree with the debit card regulation, and am glad the CC rules didn't go that far, however that major difference was lost on hegemony, who compared the credit card rule with retailers receiving something for free.

They can already give a cash discount as long as they specifically list their pricing

This was recently discussed, the rules were extremely cumbersome, such that they were rarely used. The were practical mostly for gas. Now the rules will be less cumbersome and discounts will be more common. If there was no problem in offering a discount, than certainly the rule allowing it would not have been needed, and the CC industry wouldn't have fought it.

Edited by frank22, 23 July 2010 - 11:59 PM.

[hegemony]

let's stop subsidizing unprofitable merchants.

I'd rather stop subsidizing unprofitable banks.

me too, but one windmill at a time

ETA: remember some banks were FORCED to take a subsidy...and paid it back as soon as it could to avoid the namby pambyland issues (e.g., amex)

Amex would have defaulted on their commercial paper without a bailout.

amex was forced to take tarp and paid it back as soon as the gov't let it.

[athensgaguy]

let's stop subsidizing unprofitable merchants.

I'd rather stop subsidizing unprofitable banks.

me too, but one windmill at a time

ETA: remember some banks were FORCED to take a subsidy...and paid it back as soon as it could to avoid the namby pambyland issues (e.g., amex)

Amex would have defaulted on their commercial paper without a bailout.

amex was forced to take tarp and paid it back as soon as the gov't let it.

They became a bank holding company so they could take the Fed window bailout. Without it, they would have defaulted.

[Bad Doctor Frost]

They're being offered valid payment and not accepting it.

No different than insisting they take a check despite a large "no checks" sign. If they stick to their guns, you'll either be making frantic phone calls for someone to run you over some accepted form of payment, or visiting with law enforcement. There is no requirement that a merchant take your card, your check, or your cash, if they have posted notice. There IS a requirement that you pay them.

I see it as being different. Vastly different. If they have the logo saying they accept the card...they accept it. No questions. You don't see signs at places saying "we only accept $1 bills." They either take cash...or they don't. You don't see a sign that says "We only accept checks with dancing pigs on them." They either ACCEPT IT, or they DON'T. These days, it's usually don't with checks. Which is fine. But if you're going to get my business, you're going to accept my card for $3 or $3000. If you take the form of payment, take it, smile, and shutup.

[radi8]

They're being offered valid payment and not accepting it.

No different than insisting they take a check despite a large "no checks" sign. If they stick to their guns, you'll either be making frantic phone calls for someone to run you over some accepted form of payment, or visiting with law enforcement. There is no requirement that a merchant take your card, your check, or your cash, if they have posted notice. There IS a requirement that you pay them.

I see it as being different. Vastly different. If they have the logo saying they accept the card...they accept it. No questions. You don't see signs at places saying "we only accept $1 bills." They either take cash...or they don't. You don't see a sign that says "We only accept checks with dancing pigs on them." They either ACCEPT IT, or they DON'T. These days, it's usually don't with checks. Which is fine. But if you're going to get my business, you're going to accept my card for $3 or $3000. If you take the form of payment, take it, smile, and shutup.

There are establishments that won't take cash if the bills are over a certain size, or checks for over a certain amount. It's no different. "We either accept it or we don't" hasn't applied to other payment methods for years. Why are credit cards special?
You've really never seen a "no bills over $50" sign anywhere?

[centex]

They're being offered valid payment and not accepting it.

No different than insisting they take a check despite a large "no checks" sign. If they stick to their guns, you'll either be making frantic phone calls for someone to run you over some accepted form of payment, or visiting with law enforcement. There is no requirement that a merchant take your card, your check, or your cash, if they have posted notice. There IS a requirement that you pay them.

I see it as being different. Vastly different. If they have the logo saying they accept the card...they accept it. No questions. You don't see signs at places saying "we only accept $1 bills." They either take cash...or they don't. You don't see a sign that says "We only accept checks with dancing pigs on them." They either ACCEPT IT, or they DON'T. These days, it's usually don't with checks. Which is fine. But if you're going to get my business, you're going to accept my card for $3 or $3000. If you take the form of payment, take it, smile, and shutup.

There are establishments that won't take cash if the bills are over a certain size, or checks for over a certain amount. It's no different. "We either accept it or we don't" hasn't applied to other payment methods for years. Why are credit cards special?
You've really never seen a "no bills over $50" sign anywhere?

sadly, with the advances in copiers, some places are even putting out the "no bills over $20" signs.

And yes, in every place that has a sign of SOME sort, whether it relates to cash, check or plastic, it has been prominently posted.

[hinklesc]

They're being offered valid payment and not accepting it.

No different than insisting they take a check despite a large "no checks" sign. If they stick to their guns, you'll either be making frantic phone calls for someone to run you over some accepted form of payment, or visiting with law enforcement. There is no requirement that a merchant take your card, your check, or your cash, if they have posted notice. There IS a requirement that you pay them.

I see it as being different. Vastly different. If they have the logo saying they accept the card...they accept it. No questions. You don't see signs at places saying "we only accept $1 bills." They either take cash...or they don't. You don't see a sign that says "We only accept checks with dancing pigs on them." They either ACCEPT IT, or they DON'T. These days, it's usually don't with checks. Which is fine. But if you're going to get my business, you're going to accept my card for $3 or $3000. If you take the form of payment, take it, smile, and shutup.

There are establishments that won't take cash if the bills are over a certain size, or checks for over a certain amount. It's no different. "We either accept it or we don't" hasn't applied to other payment methods for years. Why are credit cards special?
You've really never seen a "no bills over $50" sign anywhere?

Is it really a REQUIREMENT or LAW if you do not read the little sign at the register. In this instance I dine and check is $32, and all I have is a $50 bill. It is authentic and legal tender
. Say in this instance:
Restaurant "We don't take $50's"
Me: "I'm sorry its all I have"
Restaurant "We don't take $50's"
Me "Ok, have a nice day" and head for my car.

Did I REALLY break ANY law?

[radi8]

Did you break any law? Yup, it's called Theft and it's been a settled issue since at least 1920.
If you want to do business with a merchant, you agree (by doing business with them) to accept whatever terms they specify for payment. They are free to reject any form of payment they wish, and that rejection does not discharge your obligation.

A legal tender may be rejected even after the payee has performed, and a rejected legal tender does not discharge the obligation.

The Theory of Money in the Law of Commercial Instruments, 29 Yale LJ 606, 609 (1920).

Quite a few stores have cash control policies that don't provide the ability to make change for larger bills even if they wanted to. You may well be leaving your $50 as a security deposit while you run and get the correct change.
You don't get free merchandise merely because you don't have any small bills on you and didn't bother to read.

[Bad Doctor Frost]

That was 1920. Hmm. I have the feeling that these laws will change in the not-so-distant future to keep up-to-date with the changing ways of business. Not accepting checks, having minimums for CC use, not taking certain bills. Do you want customers? What happened to the days when money was...money? I'm the customer. I should be able to pay any way I want. If not for me, you wouldn't HAVE a business. When does it stop?

[hinklesc]

Did you break any law? Yup, it's called Theft and it's been a settled issue since at least 1920.
If you want to do business with a merchant, you agree (by doing business with them) to accept whatever terms they specify for payment. They are free to reject any form of payment they wish, and that rejection does not discharge your obligation.

A legal tender may be rejected even after the payee has performed, and a rejected legal tender does not discharge the obligation.

The Theory of Money in the Law of Commercial Instruments, 29 Yale LJ 606, 609 (1920).

Quite a few stores have cash control policies that don't provide the ability to make change for larger bills even if they wanted to. You may well be leaving your $50 as a security deposit while you run and get the correct change.
You don't get free merchandise merely because you don't have any small bills on you and didn't bother to read.

I just find this (as well as the credit card minimum of $10) very ridiculous.

Police roll in and you have a $50 and a $50,000 CL Visa on, say a $7 check.

"Im sorry officer, I have two payment methods and restaurant won't accept either. You are more than welcome to verify the authenticity of General US Grant by calling the Secret Service if they cannot swipe the Visa".

I HIGHLY DOUBT there would be any charge of theft out of that, and I'm sure the restaurant owner will take one of the 2 when officers arrive. Most would find the restaurant unreasonable. Theft at restaurants is usually reserved for the people that walk out on the check.

I have seen those signs before. They are usually posted at smaller establishments near the register. Usually by the time you see these you have already finished your meal.

Makes you wonder though how many have been caught with their pants down... Guess you should be careful at unfamiliar places...