6 ms·

So you hate getting something back for choosing one payment method over another when there's no indication that retail stores would lower their prices if credit

So you hate getting something back for choosing one payment method over another when there's no indication that retail stores would lower their prices if credit cards (and their transaction fees) were wiped out?

nothrabannosir 8y ago
> there's no indication that retail stores would lower their prices Competition will lead to that. It doesn't happen immediately, it happens in waves. These are called price wars. When that happens, they try to undercut competition at every possible turn, and having lower payment processing fees allows them to go lower. Who wins a price war? The consumer. Yes: points are ridiculous. The fact that credit card fees are passed on to cash payers is ridiculous. Visa and Mastercard are absolutely minted. Where does that money come from? You and I. (and: why does competition not work for Visa and Mastercard as well as it does for retailers? Because the feedback loop is much longer. Intractable, in practice. Choosing one retailer or the other is a clear signal we can send. But are we going to choose merchants based on payment processor support? As for merchants, they're stuck in an oligopoly. Competition is gone, leading to this unhealthy market.)
ardit33 8y ago
At least those "$5.00 or $20.00 minimum for credit cards" signs that you see often in coffee places and bars will go away. They are probably illegal (or against contracts) in most states, but you see them very often.
- Marsymars 8y ago
  > They are probably illegal (or against contracts) in most states, but you see them very often. Minimum purchase requirements for credit cards were explicitly legalized in the US in 2010 as part of Dodd-Frank. Merchant agreements are not legally allowed to prohibit them.
  - myrandomcomment 8y ago
    Thanks for share this. It is news to me as that used to be prohibited by the CC. "2010 law: up to $10 minimum OK. The law says that merchants can set a credit card minimum purchase of up to $10, as long as they treat all cards the same. It also allows the Federal Reserve to review and increase the minimum payment amount."
majormajor 8y ago
There is some indication of that - gas stations have seemed to be leading the push here, with "cash-only" prices, but you'll also see places with CC fees or minimums (as much as the providers try to crack down on this).
- ghaff 8y ago
  This goes through cycles every few years. We seem to be in the cash discount part of the cycle now. Then stations discover they don't like losing customers who want to pay by credit but are getting "ripped off." Admittedly apps may make things different this go-round.

nothrabannosir 8y ago

> there's no indication that retail stores would lower their prices Competition will lead to that. It doesn't happen immediately, it happens in waves. These are called price wars. When that happens, they try to undercut competition at every possible turn, and having lower payment processing fees allows them to go lower. Who wins a price war? The consumer. Yes: points are ridiculous. The fact that credit card fees are passed on to cash payers is ridiculous. Visa and Mastercard are absolutely minted. Where does that money come from? You and I. (and: why does competition not work for Visa and Mastercard as well as it does for retailers? Because the feedback loop is much longer. Intractable, in practice. Choosing one retailer or the other is a clear signal we can send. But are we going to choose merchants based on payment processor support? As for merchants, they're stuck in an oligopoly. Competition is gone, leading to this unhealthy market.)

ardit33 8y ago

At least those "$5.00 or $20.00 minimum for credit cards" signs that you see often in coffee places and bars will go away. They are probably illegal (or against contracts) in most states, but you see them very often.

Marsymars 8y ago
> They are probably illegal (or against contracts) in most states, but you see them very often. Minimum purchase requirements for credit cards were explicitly legalized in the US in 2010 as part of Dodd-Frank. Merchant agreements are not legally allowed to prohibit them.
- myrandomcomment 8y ago
  Thanks for share this. It is news to me as that used to be prohibited by the CC. "2010 law: up to $10 minimum OK. The law says that merchants can set a credit card minimum purchase of up to $10, as long as they treat all cards the same. It also allows the Federal Reserve to review and increase the minimum payment amount."

majormajor 8y ago

There is some indication of that - gas stations have seemed to be leading the push here, with "cash-only" prices, but you'll also see places with CC fees or minimums (as much as the providers try to crack down on this).

ghaff 8y ago
This goes through cycles every few years. We seem to be in the cash discount part of the cycle now. Then stations discover they don't like losing customers who want to pay by credit but are getting "ripped off." Admittedly apps may make things different this go-round.