If have not yet heard, using your credit card could cost you more – literally. Yesterday (January 27, 2013), a new law went into effect. This law allows retailers to pass along the credit surcharge to credit card users. This charge could mean up to an additional 4% surcharge applied to your purchase.
Why is this happening? It was part of a settlement reached in July 2012 between credit card networks and merchants as a way to help defray the costs of the swipe fees which are charged by these networks. Each time a card is swiped through the machines, retailers pay anywhere from 1.5% – 3% of the purchase price back to the network. These stores can now pass this charge along to it’s customers – up to a maximum of 4%. That means if you spend $100, you will pay $104 due to the additional charge.
At this time, some of the bigger box stores such as Walmart and Target are not including this charge to purchases. However, you may see smaller stores, grocery stores or even gas stations, passing along the charge. Even then, don’t be surprised if you don’t see this where you shop. It may take time for some to get it into place and others my still just decide not to make customers pay the charges. It is completely at the discretion of the retailer.
How will you know if you are going to be charged? The merchant must have it clearly displayed when you walk into the store. It mush also be on display when checking out as well as on your receipt (whether shopping on-line or in the store). No surprises. However, if you happen to reside (and shop) in the following states, you will not ever see these charges as these states have passed laws to forbid this practice. These states include: California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma and Texas.
What can you do about these fees? The simplest way is to shop with debit cards or stick with cash. The fees are not attached to these types of transactions. You can also petition your own Attorney General for your state to pass a ban where you reside. Finally, you can just choose to shop elsewhere – at retailers who are not opting to pass along these charges to customers.