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by losvedir13 hours ago |
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upvoteby LeBit12 hours ago|
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As a Canadian , I thought that was the expected de facto way of using credit cards: you pay everything with it so you get rewards (ie money) at the end of the year as a function of how much you used the card during the year. At the end of the month, you pay whatever the outstanding balance is, otherwise you pay high interests.
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upvoteby rootusrootus7 hours ago|
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Many of us use it exactly that way, though the rewards (in my personal experience) are immediate as soon as a transaction clears and not yearly. Carrying a revolving balance is a quick way to spiral into bankruptcy because the rates are so high (and the minimum payment is typically 1% of the balance).
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upvoteby the_af23 minutes ago|
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I thought this was how credit cards were used the world over. It's certainly how I use them. How do Americans use them that differs from this? Color me confused.

(Also: installments. They are often the norm in my country, but I understand they are less common for Americans).

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upvoteby zaphirplane11 hours ago|
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There are fees thou and i cant imagine they are losing out as a business
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upvoteby eastbayjake12 hours ago|
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Debit cards are not subject to surcharging, and any merchant doing so is violating Visa/Mastercard regulations. (And possibly state law in several places -- Colorado where I live caps surcharge at the lesser of 2% or the cost of payment processing.)
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upvoteby ecommerceguy11 hours ago|
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Correct, Toast specifically will not allow it under any circumstance.

Debit cards issued by smaller community banks or credit unions are exempt from the cap and carry higher interchange rates (often 1.0%–1.65% + $0.10).

All merchants should either do Surcharging or Cash Discount.

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upvoteby losvedir10 hours ago|
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You say "Correct", but Toast works the opposite of the person you're responding to. They charge the same fee regardless if it's a debit or credit card. They charge based on the network, and most debit cards in my experience use the Visa or Mastercard network. Yes, this is contrary to the Visa/MC terms, but I've never seen it enforced.

https://support.toasttab.com/en/article/Are-customers-charge...

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upvoteby lxgr11 hours ago|
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It’s not just community banks or credit unions. The cap is $10 billion in assets.

There’s a whole industry of mid-sized banks just below that which are offering their services as sponsor banks to fintechs that want to earn the orders of magnitudes higher interchange rates while still getting debit acceptance/less surcharges and being allowed to offer a debit product.

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upvoteby cmurf12 hours ago|
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It’s 2% or actual cost for credit cards.

Under subparagraph f)A seller or lessor shall not impose a surcharge if a customer elects to pay for goods or services by Check, cash, debit card, processing as a debit payment, or gift card.

eCheck is considered a check.

https://colorado.public.law/statutes/crs_5-2-212

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upvoteby lxgr11 hours ago|
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What even is an “eCheck”? I keep hearing that word but haven’t found a sane definition. Is it just a weird term for an ACH debit transfer?
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upvoteby projektfu8 hours ago|
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Sometimes it is a synonym for ACH, but it could be processed more literally as a check, with a check image and everything, and something like "Pre-Authorized Payment" written on the signature line. Usually they also let you specify the check number, if you wanted to have it follow your own sequence. Amazon Business was doing this with invoice payments up until January of this year.
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upvoteby 4lx8712 hours ago|
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Prices reflect the credit card merchant fees, even if there's no separate surcharge. People pay higher prices and anyone who doesn't use a credit card to recoup some in "rewards" is effectively getting taxed.
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upvoteby rootusrootus7 hours ago|
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There is some nuance there. Cash is hardly free to process, and I have seen arguments that it is not far from the same overhead as credit card fees. So people who pay in cash are not subsidizing credit card users. Maybe it could be argued that debit card users are, though.
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upvoteby 4lx8712 hours ago|
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You get charged higher prices and then have to use a credit card to recoup the loss, so that rent-seeking monopolists can make money. And Americans are also seemingly baffled by the idea of regulating this away, as if other countries doing this don't exist. Credit cards are the USA epitomized.
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upvoteby lotsofpulp11 hours ago|
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It was regulated away in the Durbin Amendment of the 2010 Dodd-Frank law:

https://www.congress.gov/crs-product/R41913

https://www.ftc.gov/business-guidance/resources/new-rules-el...

American sellers have had the option to collect however much extra they want from people paying with credit cards, and many do. The government, utilities, mobile network providers, insurance, schools, healthcare, gas stations, home contractors, etc all usually collect at least 2% to 3% more if a buyer wants to pay with a credit card.

I am down to only using my credit cards for retail purchases, restaurants, and travel. Otherwise, the extra cost of paying with credit cards don't make sense and I pay with debit card or electronic money transfer (ACH/Zelle).

Basically, the sellers that continue to collect the same price from credit card users and non credit card users are those who believe that incentivizing credit card usage will result in sufficient people paying sufficiently higher prices such that it offsets the processing costs of the credit card transaction (and the chargeback risk).

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upvoteby rootusrootus7 hours ago|
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It is interesting the breadth of experiences in this regard. I pay basically everything on my card, to the tune of 5-6 grand a month, including utilities. The only time I have ever seen a surcharge is for things like contractors doing work at my house. The gas company, electric, the city, all take the card with no extra charge. I rack up a lot of airline miles just from day-to-day use.
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upvoteby vjvjvjvjghv6 hours ago|
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None of the utilities for my house take credit card without surcharge.
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