New Credit Card Fee Hits Consumers in The Wallet
Posted Scott B. Cooper on Jan 30, 2013 in General
Watch out for these new fees? What do you think of this latest credit card gouge?
A surcharge went into effect Sunday that allows retailers to charge consumers up to 4 percent when they use a credit card to pay for purchases.
Like to pay with credit? It may cost you.
A new surcharge went into effect Sunday that allows merchants to pass on a surcharge to consumers who pay with credit cards.
The new fee is the result of a settlement between the credit card companies and merchants, according to CNN. The multi-billion dollar settlement was announced in July and it includes Visa, MasterCard and nine major banks, CNN reported.
But what does it mean for you? Visa laid out exactly how the new surcharge will affect ordinary consumers' purchases:
- You will pay an additional fee when you use your credit card at retailers who decide to impose the surcharge.
- The charge is capped at 4 percent. CNN reported that retailers can only charge enough to cover the processing cost, which is usually about 1.5 to 3 percent of the total purchase.
- The charge will not apply to debit cards or prepaid cards – only credit cards.
- Any retail who imposes the new surcharge has to notify consumers somehow, either at the store entrance, at the point of sale or in an "online environment."
- You will see the surcharge on every receipt, whether you buy online or in a physical location.
Not all retailers will impose the surcharge. And those who do have the option of offering discounts to consumers who pay with cash, check or PIN debit instead.
Currently, 10 states prohibit surcharging. They are: California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma and Texas.