Photo credit: Lotus Head

Pulling plastic out of your wallet to make a purchase is probably a daily occurrence that you don’t think much about. We pay for gas, for lunch, for new shoes, for plane tickets…the list of what we use a credit or debit card for is endless. For some, credit cards may be a nasty reminder of a debt they’re trying to pay off. Maybe some have vowed to only use cash for purchases ever since the US economy took a dive. But most of us employ the convenience of that little plastic card more often than not.

The act of paying with a credit card is simple, but there are a lot of things that happen behind the scenes for the transaction to complete, let alone be possible.  The store that you’re buying your new dress from is a merchant and in order to accept credit cards, that store has to have a merchant account (a bank account that allows that store to take credit and debit card payments).<

Some folks may not realize that the stores with are charged fees in order to use the service. Although it’s in a store’s benefit to take plastic because it can increase sales, there are merchants who try to minimize the amount of money they fork over to their merchant account providers for taking credit card payments. Here are three credit card practices that you may not have been aware of:

1. Stores cannot impose a minimum purchase. Have you ever stopped at a convenience store to grab a drink because you were dying of thirst? You only have that one beverage on your mind; you’re not distracted by anything else. You go up to the counter to make your purchase. The total is $1.57. You pull out your card but the cashier says “It’s a $5 minimum purchase for credit cards.” Quickly you look around for something else to add to your drink.

This is wrong. Stores must accept credit cards for any amount. The owners try to institute a minimum purchase amount because they don’t want to have to pay a fee for small purchases. They get away with this since most people don’t know that they can’t. You can politely mention that you know the store isn’t allowed to do that and see what happens. I’ve tried it before but was told that it was the owner’s rule and he was just a lowly clerk and didn’t want to get in trouble. I left without making a purchase. No way was I going to spend $3 more than I needed to just because I didn’t have any cash on me.

2. Merchants can offer discounts for paying in cash. Let’s say you brought your old clunker into the shop. The mechanic tells you the total for all the work that needs to be done over the phone. After you pick your jaw up off the floor, you offer him your Visa card number. He says, “Sure, we’ll take Visa but if you pay me in cash I’ll knock 10% off of the total bill.”

This is actually acceptable. Merchants can offer a discount off the total price of the items or services at their own discretion. They cannot, however, add an additional amount to the purchase price if a credit card is being used to counter the merchant fee that they are charged.

3. You can split your purchase across multiple cards. You’ve got your eye on a new Rolex. You have to have it, but it’s well above the limit of any one of your credit cards and you don’t want to pay cash. You approach the clerk and ask to pay with three different credit cards, with differing amounts on each.

If you want to distribute the cost of your purchase across a few of your cards, you can absolutely do that; a store cannot refuse that. The only opposition you might come across is an inept cashier that doesn’t know how to perform that function.

Obviously these practices mostly only apply to in-store purchases. When it comes to eCommerce payment processing, credit cards (or electronic checks) are pretty much the only way to pay so online retailers aren’t trying to find ways to get you to pay in cash. Hopefully the next time you encounter a sneaky merchant who is trying to break the rules, you’ll be armed with a bit more information if you’re intent on paying with your credit card.





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