New Credit Card Checkout Fees
Starting on January 27, 2013, some retailers may start tacking on new "Checkout" Fee to cover the cost of processing a Visa or MasterCard Credit Cards. Credit Card fees that merchants pay are typically between 1.3 to 3 percent, however, what the merchant can charge is currently going to be capped at (4) four percent.
Merchants won the right to charge these fees under a class action settlement with Visa, MasterCard and large banks last summer.
Previously, merchants from store to restaurants had been prohibited from imposing a surcharge because the practice is banned in contracts that banks and credit card companies have with sellers.
While the result of these fees may be beneficial to retailers by allowing them to recoup some of their banking costs, there may be a backlash from consumers who receive these charges.
The rather ironic fact here is that many retailers have already increased their prices in order to offset these fees that they pay, so in some cases, customers could actually unknowingly be paying for this fee twice…
The details are:
- Sellers will only be allowed to surcharge customer for the actual cost of processing credit card transactions – However, this may be difficult to enforce with many retailers because the fees that they pay are based on total transaction volume, so the actual real amount may not be know until the end of their banking billing period.
- Complicated rules allowed retailers to choose which card types that the surcharge will apply to.
- Debit Cards and Prepaid Cards will not be subject to a surcharge.
- Brick and mortar retailers will have to post notices at the stores entrance, at the register (with the specific percentage), and on their receipts.
- Online sellers will have to put a notice on the home page and/or page where credit cards are first mentioned.
- Stores must continue to abide by state laws that prohibit or restrict credit card surcharges such as California, Colorado, Connecticut, Florida, Maine, Massachusetts, New York, Oklahoma, and Texas.
If you have any questions or concerns regarding the above changes, please contact the CCS Retail Systems Support Department.
– John