I am trying to understand why certain merchants charge fees/purchase minimums (sometimes against the rules) for credit vs debit cards. What are typical merchant fees/surcharges for using debit vs. visa vs. mc vs. amex vs. discover? Im hoping someone who runs a store/business with personal knowledge of the various rates can chime in here...

NO FEE FOR USING A CREDIT CARD

NO ID REQUIRED ON A SIGNED CREDIT CARD

NO MINIMUM PURCHASE REQUIRED

NO MAXIMUM PURCHASE REQUIRED

RATES CAN BE AS LOW AS 1% UP TO 5% (SO PEOPLE HAVE SAID)

You beat me to it GEORGE!

An store that charges a fee or has a minimum purchase for Visa/MasterCard/American Express is in violation of the agreement they signed!

You can report them to Visa (1-800-VISA-911), your bank, MasterCard (via website) and AmEx (via website). They will then warn the merchant or maybe fine them for the violation.

Check out the VISA MC Policy subforum for more about this.

Dont get me wrong, i understand BBQ and George's plight and that these merchants are in violation of their prospective agreements, im just trying to understand why they financially feel the need to charge these fees.

By the way, are merchants bound by any rules not to charge fees for DEBIT transactions?

Credit: As much as 30 cents per transaction right off the top, and as much as 2.25% (or higher for some internet processing) of the total purchase. Large corps like walmart get lower fees - small fry pay the most. Oh, and the small fry often have to pay from 25 to 50 (or more) monthly for the privledge.

Debit: the fee schedule is different. It's my understanding the transaction fee is higher but the % is lower (or maybe it's reverse) - i don;'t take debits but a friend who did said under $20 debit meant more profit for him, over 20 and credit transaction left him keep more. He instructed his employees to choose debit for under $20 sales when the customer said they didn't care.

For debit they can do whatever they want for fees, surcharges, minimum, and maximum. Though, in some states, a fee/surcharge may be illegal... so if you are in one of those states they can't add fee/surcharge.

Some businesses don't understand that credit card fees are a cost of doing business and they think that they can directly pass it onto the customer (which is not allowed).

I don't get why these companies just don't raise prices by 2-3% to cover the fees... that's prefectly legitimate. Hide the cost of CC fees in the product price just like the cost of paying employees, water, electricity, maintainance, etc.

HUHHH???

DEBIT IS A DIFFERENT ANIMAL

As far as I know some businesses "CAN" charge a fee to use DEBIT and suffer no ill effects

If a merchant wants they can charge a fee/surcharge for debit... as long as there is no state law against it.

But they can't surcharge Visa/MC!

So if you see a store surcharging for debit and are using a debit MasterCard or debit Visa / Visa Check Card... make sure they run it as credit (over the Visa or MC network). You will have to sign the receipt -- do NOT enter a pin#.

In my area (Ohio) Taco Bell charges me .75 cents to use my debit, they don't accept credit cards. I have a debit card with a Visa logo on it from Chase.

I usually never carry cash so when I'm out and about with the kids, they'll want taco SMELL for dinner and of course, I never have enough cash.

Then you've obviously never worked in a small retail business. I just did a couple of years in a neighborhood liquor store (where we followed the surcharge/minimum rules) and we'd run as many as 200 credit/debit transactions per day. That seriously adds up! And with small shops on every corner the business can get pretty cutthroat. We were able to survive not paying the fees (and having employees fo that matter) because we'd built a great reputation over the last 100 years of being on that corner. Even so, each year profits just kep going down and there's little they can do about it.

-Aahz

It is a proven fact that credit card users spent a higher amount on each transaction, though. This is good for a lot of businesses.

A lot of the fast-food places have seen big increases in sales since they started taking credit cards. Before, people would go to a resturant that took credit cards because they didn't have cash -- even if it meant they would pay like $50 for a meal for 3-4 people and not $15-20.

Dominion Power charges a fee. They're not exactly the 'mom and pop' grocer on the corner. Any reason they can get away with it?

does taco bell add it or the bank? My banks don't add fees for debit use, but some in this area do - i seem to get behind their customers at the grocery store and they need help canceling the debit transaction and rolling it to visa.

The third-party processor gets that fee, not Dominon Power.

Goverment use has different rules since it's everyone's money that is getting shortchanged when you use a credit card to pay taxes or utilities.

Also, check your state's laws...in Florida, it is a CRIME to charge a fee or surcharge for using a CC.

A 3rd PARTY COLLECTOR DOES

THE "POWER COMPANY" CHARGES NOTHING

VISA MC policies

And in at least one state the law specifically allows surcharges and overrides the CC policy.

FOR CITY/STATE/FEDERAL GOVERNMENT

But not a business like say TARGET or TACO BELL or BLOCKBUSTER

You are incorrect.

...AND THAT STATE IS WHAT SO I MAKE SURE I NEVER

SPEND EVEN $0.01 THERE!!!

If you're talking about the thing you posted in another thread from Minnesota, it was my interpretation that the state does indeed specifically allow fees, but that that would not prevent a private agreement, i.e. merchant agreement, from still prohibiting them.

That it true, but it makes no sense. In my mind, it defies the intent of the rule, if not the actual wording. Regardless of whether it's being processed through ABC Power or XYZ Middleman Company, I'm still paying my power bill.

THEY ARE DOING WHAT THE IRS DOES...

I COULD JUST SEE McDONALDS GETTING A 3rd PARTY COLLECTOR AND START CHARGING $1.00/CUSTOMER

NOT!!!!!!!!!!!

Debit is always cheaper. Most processors charge a flat fee for Debit of around 15¢/transaction, usually cheaper than Credit's base fee.

Credit is anywhere from 25-50¢ + 1.25-2.5% for merchants depending on if its Visa, MC, Disc, and Amex. VS/MC are the cheapest, AmEx is the most expensive.

Credit & Debt processing cost eat up around 1-1.2% of total sales for us, which if not present, would have added around 16% to our bottom line, which is quite a bit. I imagine that is why merchants try to charge, especially ones with low $ transactions as the fees eat up a lot on a $5 purchase. Our average credit transaction is well over $40 so it doesn't affect us as much.