Monday, January 28, 2013

Credit card swipe fees.

Retailers who take credit cards, have to pay a percentage of the amount that is charged plus a small flat amount as a base -- swipe fees.  Now, as part of last year's settlement with credit card companies, retailers are allowed to add a surcharge to recover these fees.

This is an important means of recovering the fees charged, especially the flat fee portion for each credit card swipe, for small businesses faced with people who charge small amounts (say $5).

On the other hand retailers, if in business long enough, have already priced their goods to incorporate this as a markup on their goods and services, up to a point.

The way I see it, just don't use your credit card to make small charges.  If we can all agree to stop using our credit cards for amounts under $5, then retailers should agree not to add surcharges for anything above $5.

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