So today marks the day where the ban on merchants charging consumers a credit card surcharge fee has been lifted in 40 states, including mine. What this means is that merchants can now add an up to 4% surcharge on all purchases made with a Visa or Mastercard.
My credit card strategy is outlined here. Basically talk about how I use my credit card for everything. It is unclear to me whether or not AMEX is affected by the lifting on the ban, but early reports seem to suggest that the surcharge may not apply to AMEX. I currently use my AMEX for almost everything unless I’m getting a preferred quarterly cash back through my Chase Visa card.
Most news outlets have reported that many large retailers (Walmart, Target) won’t bother with the surcharge, but many smaller outfits may entertain the idea. The only caveat to the surcharge is that the retailer has to let the consumer know (verbally or via display) that they issue a surcharge on credit card transactions.
So the only change I’m making is that if I’m in a store that does not accept AMEX and does charge a surcharge over and above the cash back reward that I earn on my Chase Visa card, I will be using cash.
In my humble opinion, I don’t believe there ever should have been a legislative ban in the first place. If a retailer needs to charge more for a credit card transaction to make up the cost of the fee, they should have been allowed to do so and let the consumer decide how they want to purchase their items. If the original ban was not via legislation, but via contract between the credit card company and the merchant, then the ban should continue to stay as per the contract.
I’m still trying to understand the background to this, so if you have any information, leave it in comments!