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    4 Replies Latest reply on Jan 31, 2013 2:31 PM by Moderator Berta

    Will your business charge customers who use credit cards to pay?

    amspcs Ranger

      It is now legal for businesses to charge up to 4% extra to customers who pay with credit cards.  Does your business plan to implement such a policy?  Why or why not?

        • Re: Will your business charge customers who use credit cards to pay?
          Moderator Berta Guide

          Great question amspcs! Looking forward to seeing our members answers.

           

          ~Berta

          • Re: Will your business charge customers who use credit cards to pay?
            nstephanie Wayfarer

            Good question. I'm looking forward to seeing the answer as well. For my business, the customers don't want to be charged 4% extra for credit card fee. In order to offer the low cost service we have to charge this extra fee otherwise we will not make benefit. We prefer to get paid by check but it is not secure or the customers don't have cash on hand to pay then we didn't get the business/sale

              • Re: Will your business charge customers who use credit cards to pay?
                Moderator Berta Guide

                As a consumer, I have to agree with you nstephanie! I don't want to be charged extra for using a credit card. Times are just as rough on me, the consumer, as they are on you, the business owner. I work hard for my money and will look for savings and value where ever I can.

                 

                If you are accepting checks and cash without charging the extra fee, but need to charge the fee on credit cards to be able to make a profit, how are you still in business? Low prices are great for the consumer but you can't make your prices so low that you don't profit from your business. Breaking even is not the way to keep a business in business..

                 

                ~Berta

                  • Re: Will your business charge customers who use credit cards to pay?
                    Robin Williams Tracker

                    All the merchants have legal rights to charge customers a surcharge for paying with a credit card under the maze of rules, terms and condition followed by the state laws under merchant processing agreement. You charge the fees to the customer mainly because you pay fees to the bank that processes credit transactions, and is probably the same bank that handles all your business accounts.

                      • Re: Will your business charge customers who use credit cards to pay?
                        Guide

                        Hi Robin,

                         

                        Since credit cards have been around there has always been a fee charged to the merchant for using the banks services (with the exception of Discover Card - don't know if thats true anymore though). So none of this is new. This seems to be an extra fee if I understand it correctly. My feelings are the same as before  New Merchant Surcharge Rules.  

                         

                        Melinda

                        • Re: Will your business charge customers who use credit cards to pay?
                          amspcs Ranger

                          Hello Robin, thanks for your contribution to this thread.  I am compelled to comment on your thoughts.  First, I don't think anybody disputes that merchants now have the right to surcharge customers for paying with credit cards. That's not the issue.  The issue is:  Is it a wise business practice to do so?  What one CAN do and what one SHOULD do are two entirely different things.  From a smart business standpoint, I feel it is not. Why go out of  your way to antagonize and drive away paying customers?  Secondly, your statement that most merchants commerical banks and processing banks are one-in-the-same is an inaccurate assumption.  Yes, SOME merchants do utilize the same local bank branch that handles their checking account(s) as their source for payment processing.  But the truth is, that practice is pretty much limited to merchants who don't know any better.  Savvy merchants understand that commercial banking and payment processing are two entirely different and unrelated industries, and the only role their local banker generally plays on the processing end is that of a paid referrer to some ISO or processing network.  Stated another way, the only thing merchants accomplish in most (not all,but the vast majority) cases when they use their local bank as processors is to add an additional unnecessary middleman to the pricing equation, thereby INcreasing the merchant's overall payment processing expense.  Merchants who understand such things go directly to the source, not through a middleman.

                    • Re: Will your business charge customers who use credit cards to pay?
                      ksmithlmp Newbie

                      I personally will not be charging an extra fee for using a credit card.  As I sat down to get eveything ready for tax time, I realized that my credit card transactions were responsible for close to 2/3 of my income.  I would rather eat the higher percentage rate rather than risk losing valued clients!