I wrote this post a few weeks ago about Visa and MasterCards' recent $7 Billion settlement with a bunch of retail groups over interchange fees. Would You Pay Extra to Use Your Credit Card? - CreditCents Check it out, and then share your thoughts about whether you would be willing to pay extra to use your credit card. I'd love to hear what you think.
Josh; This is a good article.. I saw online where Walmart does not want to settle for this low amount. To answer the question, NO! Whenever I find a merchant that wants to charge me for my choice of payment I stop doing business with them.
Would I? Sure. Do it all the time. Would I prefer not to? Of course. But, I think the more fundamental question is, "why do you think the price you see on the box is really the price you'll end up paying?" (because it used to be? when?) There have always been "adjustments" to the price you see and the price you pay. Start with sales and other taxes that are added on to the price when you walk out the door. Since most people have to pay those, why not include them in the box/sticker price? Then there are all the "optional" costs (or up-sell items). Extended warranty, monthly service, additional options, etc. Or look at airline travel pricing, if you want to see this taken to the extreme. (And I thought airlines were bad until i went on a cruise ) And, how did your last new car purchase go? Tell me they didn't try to add on: undercoating, hood protection, extended maintenance, document fees, paperwork fees, etc. etc. etc. My last house purchase has almost an entire page dedicated to all the nickle and dime ($500 & $1000) fees that appeared during escrow. After that, there's all the hidden prices that occur after the purchase. Subscription fees, service fees, more additional options. In marketing, these are called added-value, meaning you won't buy them unless you perceive them to provide additional value to your experience. If you're happy reading only one article (over and over) then don't buy the subscription for your e-book. OTOH, if you want new content, is it wrong to have to pay for it? I mean you didn't have it when you bought the e-book. At least with credit-card/cash fees/discounts, you see the price before (or during) the purchase, when you have the opportunity to change your mind and say "I'm not paying an extra x% for this." In fact, almost all of the examples above work their extra charges before the purchase. Credit card and bank fees, almost always appear AFTER the purchase when it's too late to change your mind (easily). That's improved some recently, but still happens and catches the unsuspecting consumer by surprise. What to do? I've just given up and now I figure the ACTUAL price is 10-20% more than what I see on the box. With that in mind, if I still want it (at the 20% "marked up" price) I'll buy it. If I can negotiate, I might, but that depends on what it is and what else is going on. If that price is too high, I'll move on. There are more important things to worry about.
No, I would not pay extra to use my credit card unless I didn't have a choice or it was the most convenient thing for me to do. I pay cash to my hair dresser and she gives me a discount, I think other small business would do the same if you asked. I understand why smaller businesses would have to charge an extra credit card fee. I would still avoid it if possible. Thanks! Heather with BoostMyScore.NET
"I don't know about you, but I haven't received a single discount for paying with cash yet." The author of this article obviously hasn't taken advantage yet of buying gas with cash and saving up to $.05 a gallon or more. My CU charges a $.25 pin fee when using my debit/credit card as a debit, so I stick with credit transactions. Also I've found the best rewards program is with debit cards. A lot of major retailers have rewards programs for making purchases with cash or credit.
I choose to buy all my gas at Costco, so no- I haven't taken advantage of buying gas with cash. I don't know for sure, but I'm fairly certain the gas I buy at Costco is still cheaper than anywhere else in town, and I also get 4% cash back with my Amex Costco card. That's tough to beat. By the way, you mention that you've found debit cards offer the best rewards programs. Would you mind sharing a few that come to mind? I'm just curious because I've found the exact opposite.
Joshua, I did a local gas price comparison online just out of curiosity as a Costco just opened here last Friday. Their prices are a few cents lower than gas stations that offer cash discounts per gallon and the saving for you is realized in your AMEX Costco Card. For my own comparison, I factored in annual membership fees, (and whether I would buy other items besides gas from Costco) distance and convenience. I could use my Barclays reward MC that offers double points for gas purchases but they are just points, not cash back as is your AMEX Costco Card. As far as debit card reward programs I was not specific enough. I meant to say "debit card" as I have only one which the rewards program (UChoose) is points based only (not cash back). I've only compared it to other credit card points based reward programs which is not a good comparison... sort of like apples to oranges. However for me personally I use my debit card for most purchases and as a result my points add up rather quickly.
Quite simply no I would not pay extra to use a credit card. I have been cash and carry for the last 15 years. Part of that was due to my having poor credit. I've gotten use to paying cash and just couldn't see myself paying extra to use plastic.
I've done the comparisons too and Costco always comes out on top for us. We shop there for a lot of other things too, so it's not really inconvenient at all to fill up before or after a Costco run. I've never seen lower prices around town. Anyway, I'm curious why you choose to use debit over credit for most purchases, when you could earn much higher rewards with a credit card and enjoy much better consumer protections (e.g. purchase protection, fraud protection, etc.)? I guarantee you there are many rewards credit cards out there that would allow you to earn a lot more in rewards than what you're getting with a debit card.
That's a good question Joshua. When it comes to purchases over the phone or memberships (eg gyms etc) I always use a credit card. Paying bills online or POS I use my debit card. Guess I'm old school with that respect. I'm anxious to see how the rewards program works with Barclay.... I've only heard good reviews.
