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Reminds me of how the cardholder agreements used to all prohibit adding a credit card surcharge to cover the fees. Some of the fees go back to the customer as rewards, so customers especially had no reason to use cash. Now that practice is illegal, and many places are 3-5% cheaper with cash, which is in line with the fees and usually much larger than credit card rewards.

by BenoitEssiambre5 hours ago|

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Is that practice illegal? I've never gotten a discount for using cash or debit.

That is the crux of the problem though. By adding fees and then contractually forbidding merchants from passing those fees on to credit card customers, it is forcing non card users to pay for card users fees since the fees are embedded in prices. Plus they're even giving card users kickbacks in the form of points. So non credit card users end up paying more credit card fees than credit card users which is nonsense.

by tastyfreeze4 hours ago|

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Not illegal. Card issuers required merchants that wanted to accept their cards to not have separate pricing for cash and credit card. It would have been a lot more difficult for credit cards to take over as the primary payment method if they had to convince consumers that the convenience of a card was worth paying 3-5% more on everything. Exceptions started being added for public entities, like municipalities, that wanted to accept cards.

> So non credit card users end up paying more credit card fees than credit card users which is nonsense.

The business just makes more money on cash transactions. It would be interesting to find if the cost of cash handling/losses is comparable to the card processing fees.

by toast03 hours ago|

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> Is that practice illegal? I've never gotten a discount for using cash or debit.

It is no longer permitted for payment networks to prohibit discounts for cash or surcharging use of credit.

A few of the merchants I use regularly have credit surcharges now. It's pretty common at gas stations near me. Almost all business with my state or local government has a 3% fee for card use.

by mahboi3 hours ago|

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Yes in the US. It's usually gas stations, small businesses, and less expensive places offering the discount. The only gas station around here that doesn't charge extra for card is Costco, where they also don't take cash.

by BeetleB4 hours ago|

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So yes - the shop owner will get to decide which banks' VISA cards he will accept.

Fundamentally, I agree with the lawsuit. Logistically, this seems like a bit of a nightmare. No longer will it be "CC purchases will have a 2% extra fee." Instead it will be "If you have a Chase Spark card, the fee will be 4%. If you have a Costco Visa card, it will be...".

by criddell5 hours ago|

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That sounds a lot like they want to be able to say which banks cards they want to accept (the "forced merchants that accept any Visa and Mastercard credit card to accept all such cards" part).

by buzer5 hours ago|

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It's most likely primarily about different credit card "brands" like Visa infinite, signature etc. These have different benefits for customers (like cashback and points) and higher fees for merchants.