Merchants Can Now Charge Credit Card Fees

[GGG]

Originally Posted by Cecil Terwilliger

Nobody thinks rewards points are free. They know it costs the merchant, they just don’t care.

The fee charged to consumers won’t be dependent on the type of credit card. Everyone will pay the same fee. So the people with non rewards cards will still be subsidizing the rewards cards.

This helps no one, including merchants. It’s incredibly naive to think this will result in merchants banding together to fight credit card companies. All this does is cost customers more and make merchants look bad. The credit card companies are laughing at people who think this is to their benefit.

The fact that merchants have been hoodwinked into thinking this is the solution and not banding together with consumers for better consumer protection is a sign of how poorly the average business owner and customer understand what’s happening. Hardly surprising though.

By merchant - you mean the consumer currently pays the hidden fee. That’s how a universal fee like a tax is passed through to the consumer

If you believe this helps no one why was this clause not to charge a fee in merchant agreements?

As to whether different cards will charge a different fee that will be interesting as they can charge more then they pay in fees, it’s unclear from the article if that is per card or in aggragate

[malcolmk14]

Originally Posted by monkeyman

Who uses cheques anymore? Just pay using automatic withdrawal.

It's my little way of protesting the fee.

[shogged]

Originally Posted by monkeyman

Who uses cheques anymore? Just pay using automatic withdrawal.

I would never give any person or corporation the keys to my bank account. That’s just asking for trouble.

[topfiverecords]

I think you can pay your Telus bill at their stores. Go in and pay your bill in nickels.

[Chewy]

Pay by real actual cash. People forget that actual cash transactions cost businesses more time/effort and bank fees than credit card transactions. That can be a protest against surcharges. Companies want auto debit or interac to save fees.

[Jacks]

Originally Posted by OldDutch

Manual touch transactions can cost around $40 for large corps to process. Just all the AR layers. Even if it was half for Telus it would cost them 10x what the fee is.

This to me is a legit way to hurt them for doing this if they take manual check. Now it also costs you time and energy as well but if enough people do this I can see them do what all corps do…stop taking manual checks lol

I doubt it costs them $40 to cash a cheque. I would imagine they have a cheque scanning machine that does most of the work. Even if it did cost them more than a buck or two good luck convincing people to join your protest when it means ordering cheques, buying envelopes/stamps and walking to the mailbox. You fight the power brother.

[PeteMoss]

Originally Posted by GGG

By merchant - you mean the consumer currently pays the hidden fee. That’s how a universal fee like a tax is passed through to the consumer

If you believe this helps no one why was this clause not to charge a fee in merchant agreements?

As to whether different cards will charge a different fee that will be interesting as they can charge more then they pay in fees, it’s unclear from the article if that is per card or in aggragate

Is there any way to know when accepting a card what rate the merchant is going to charge you, particularly if it's online? You could charge different fees for amex vs mc/visa but I'm not sure it's easy to differentiate between reward card vs non reward card.

[Jacks]

Originally Posted by Chewy

Pay by real actual cash. People forget that actual cash transactions cost businesses more time/effort and bank fees than credit card transactions. That can be a protest against surcharges. Companies want auto debit or interac to save fees.

So you are going to go to an ATM and withdraw cash, drive to a Telus office (at $1.50-$2.00/litre) and stand in line to pay with cash?
All to avoid the dollar or two service fee which you can avoid anyway by paying Interac or through your online banking?

[Slava]

Originally Posted by shogged

I would never give any person or corporation the keys to my bank account. That’s just asking for trouble.

My cell is through Rogers and there’s no chance I’d give them authority for automatic withdrawal. I’ve been scammed, so that’s obviously a concern, but they’ve also proven impossible to deal with. I don’t trust them and I’m definitely not going to be out in a position where they’ve overcharged me and I’m hoping to get money back.

[you&me]

Originally Posted by Slava

My cell is through Rogers and there’s no chance I’d give them authority for automatic withdrawal. I’ve been scammed, so that’s obviously a concern, but they’ve also proven impossible to deal with. I don’t trust them and I’m definitely not going to be out in a position where they’ve overcharged me and I’m hoping to get money back.

I recently switched carriers and ended up with a billing credit from Rogers for the portion of the month I didn't use (or something like that)... Anyways, I had the same thought as you and was mentally prepared just to write off the money, but surprisingly, I got a check in the mail within about a week. As ridiculous as it seems, I was impressed that it was handled so quickly, if not at all hahaha

Sorry for the tangent.

[Wormius]

Originally Posted by Cecil Terwilliger

Nobody thinks rewards points are free. They know it costs the merchant, they just don’t care.

The fee charged to consumers won’t be dependent on the type of credit card. Everyone will pay the same fee. So the people with non rewards cards will still be subsidizing the rewards cards.

This helps no one, including merchants. It’s incredibly naive to think this will result in merchants banding together to fight credit card companies. All this does is cost customers more and make merchants look bad. The credit card companies are laughing at people who think this is to their benefit.

The fact that merchants have been hoodwinked into thinking this is the solution and not banding together with consumers for better consumer protection is a sign of how poorly the average business owner and customer understand what’s happening. Hardly surprising though.

Why would someone use a non-rewards credit card when they have to pay an extra fee? That would be like using a non-rewards card in a foreign country and paying the foreign transaction fee on every purchase. Nobody would subject themselves to that.

[Bill Bumface]

Originally Posted by PeteMoss

Except for the people who outright offer a cash/debit discount, what percentage of companies do you think will lower prices? 1%? Telus is going to charge fee... Did they say anything about lowering the plan costs for everyone by the 2% or whatever they will charge for credit card payments?

Youll be paying the same but the credit card people will pay more.

If all the sudden there is 2% more margin on every single business in the country, people will come in and undercut those margins for market share, or in other cases that temporary bump will be eroded by future increases in other business expenses.

You're asserting pricing is arbitrary, and not directly coupled to the input costs of a business, and not directly related to demand.

If that was the case, every store may as well charge a billion dollars for everything.

[White Out 403]

Originally Posted by Bill Bumface

If all the sudden there is 2% more margin on every single business in the country, people will come in and undercut those margins for market share, or in other cases that temporary bump will be eroded by future increases in other business expenses.

You're asserting pricing is arbitrary, and not directly coupled to the input costs of a business, and not directly related to demand.

If that was the case, every store may as well charge a billion dollars for everything.

Just like grocery stores right? Pulling in massive and unheard of profits just around the same time they hike up prices because of inflation? Coincidence right?

The shocking naivety of people and the "invisible hand" never ceases to floor me. There's like 3 grocers in all of Canada, and maybe 12 businesses in all the country for everything. There is no competition anymore. These fees will be passed on to the consumer and not only we will not see a decrease in prices, everything will keep going up.

Sobeys is making more money than they know what to do with and they're about to put truck drivers out of work. Why? To save you money? lol. Isa! No, to pad their stock price and further enrich a small elite class of investors who hold massive shares and get giant dividends.

The corporations of this world are raping people. Don't participate in your own exploitation and violation.

[Shazam]

Originally Posted by Bill Bumface

If all the sudden there is 2% more margin on every single business in the country, people will come in and undercut those margins for market share, or in other cases that temporary bump will be eroded by future increases in other business expenses.

You're asserting pricing is arbitrary, and not directly coupled to the input costs of a business, and not directly related to demand.

If that was the case, every store may as well charge a billion dollars for everything.

There is this economic concept called elasticity. I assert that a 2% upward movement in prices will do nothing to dampen demand for any good or service.

[GomerPile]

We had a quick look at our transactions (85% CC, 10% debit and 5% cash), and our cost increases. We had an avg material cost increase of about 5% for the year and our transaction fees are about 2.6% with our provider. We increased prices about 8-10% depending on the item, to keep prices round and pretty looking. We knew the price increase was coming due to increased material costs, but used this time to also build in the transaction fee. That way our consumers only see it as a single price increase and not again at the till.

[Bill Bumface]

Originally Posted by White Out 403

The shocking naivety of people and the "invisible hand" never ceases to floor me. There's like 3 grocers in all of Canada.

This has nothing to do with 2% merchant fees. This is more like telecom, where you have an oligopoly that can collude to fix prices, especially in industries with a high barrier to entry, or artificial barriers to competition. They don't need any credit card rule changes to squeeze 2% more out of everybody, they're just fine doing it on their own.

Originally Posted by Shazam

There is this economic concept called elasticity. I assert that a 2% upward movement in prices will do nothing to dampen demand for any good or service.

Yup, and elasticity has a time component. Asserting that a 2% reduction in national spending power won't affect demand is a pretty hot take however.

[TorqueDog]

Originally Posted by White Out 403

The corporations of this world are raping people.

Patton Oswalt told me he thought the worst thing was the hypocrisy, and I disagreed.

[Shazam]

Originally Posted by Bill Bumface

Yup, and elasticity has a time component. Asserting that a 2% reduction in national spending power won't affect demand is a pretty hot take however.

Are people in aggregate going to spend 2% less in groceries?

[Monahammer]

Banks and credit card companies have been double dipping; taking money from card users and card acceptors, for the entire time. It's ####-tier morality, but frankly is a very useful implement for people who know how to use it effectively and safely.

It's nothing new though; and frankly, merchants have ALWAYS priced this in (or should have been) when setting their prices for items. To add the fee now on top of the price of a good in a store is just using consumers in a battle with banks. Bad for consumers, good for merchants.

Consumers don't get to win here, it's greedy people all around kicking to get pieces of an ever shrinking pie.

[bizaro86]

Originally Posted by Shazam

Are people in aggregate going to spend 2% less in groceries?

No, but they'll probably spend 2% less in aggregate over all spending if their costs go up by 2%. It'll be lots of little decisions - keep the car an extra year here, trade down from steak to ground beef there, camping in BC instead of Mexico for that couple, whatever. It's basically just a bit of extra inflation in a world where that is already an issue.