Fee For Credit Card Usage

Ben8282

I have also noticed that the places which charge for using cards are often the places with the highest prices in the first place, much like M+S charging for bags when the 'cheap' shops don't.

Near me there is a Tesco Epress and a Londis next to each other. The prices in Londis are much higher than Tesco (in fact their cigarette prices are the highest in any shop in my area, even higher than even the petrol stations) but try to use a debit card and they want 50p extra! Tesco and the petrol stations don't.

david39

Tesco and petrol stations pay a much lower credit card charge than an independent retailer.

The CC providers charge varying percentages to different classes of retailers dependent upon the profit margin expected in that class of trade - so a jeweller (high-margin trade) will pay a very high percentage whereas a £-shop (low margin business) will pay significantly less.

The petrol station will have had a low commission rate negotiated by the petrol company on a bulk-business basis for all their stations - and their percentage-margin on petrol is miniscule.

Your local Londis store will be a small independent retailer who does not have the clout to negotiate a low rate from his CC processor nor a huge discount on the stock from his suppliers. However, he does provide a service to his local community which they can elect to use or not.

redpete

david39 wrote: »

Do you really think that the companies who don't charge for credit card processing actually pay it themselves ?

Yes, when considering the single transaction. If you pay with cash they make a certain amount of profit. If you pay by CC they make this same amount less the £n they pay the CC company as a fee.

Overall they consider it worthwhile because of the additional business they get by accepting CC payments.

tomsco

redpete wrote: »

Yes, when considering the single transaction. If you pay with cash they make a certain amount of profit. If you pay by CC they make this same amount less the £n they pay the CC company as a fee.

Overall they consider it worthwhile because of the additional business they get by accepting CC payments.

Or this way. You pay with CC, they make a certain amount of profit. You pay with cash, they make even more profit.

dzug1

tomsco wrote: »

Or this way. You pay with CC, they make a certain amount of profit. You pay with cash, they make even more profit.

What's so wrong with making a profit?

If they didn't they wouldn't be there to provide whatever it is they are selling you.

And if there is competition that profit will not be excessive.

tomsco

dzug1 wrote: »

What's so wrong with making a profit?

If they didn't they wouldn't be there to provide whatever it is they are selling you.

And if there is competition that profit will not be excessive.

I think you misinterpreted my point. What I am saying is that if they charge a seperate fee, only those paying by credit cards pay that fee. If they include it in the cost then everyone has to subsidise those paying by credit cards.

callum9999

Ben8282 wrote: »

I have also noticed that the places which charge for using cards are often the places with the highest prices in the first place, much like M+S charging for bags when the 'cheap' shops don't.

Near me there is a Tesco Epress and a Londis next to each other. The prices in Londis are much higher than Tesco (in fact their cigarette prices are the highest in any shop in my area, even higher than even the petrol stations) but try to use a debit card and they want 50p extra! Tesco and the petrol stations don't.

M&S presumably charge for bags for environmental reasons - what with all the revenue from the bags being donated to charity... If lazy shoppers don't start carrying their own bags (I don't know why it's seen as such an enormous chore in this country, whereas in places like Germany it's the norm) then every shop will be forced by law to charge for them.