Be on the lookout for new credit card "checkout fees"

Posted: January 26
Updated: January 28

As of Jan. 27, it may cost you more to use your credit card even if you have no annual fees or monthly balance. Merchants will now be able to charge credit card users a surcharge for paying with credit, up to 4% of the purchase price. According to a recent article, the checkout fees will need to be disclosed on the receipt and posted in the store. Although 10 states currently have laws restricting these types or checkout fees, North Carolina is not one of them.

What does this mean for you? If you find that a retailer has opted to charge a checkout fee if you pay by credit card, that is the time to pay by cash or check. Debit cards are also exempt from these fees.

The only reason we use our credit card is because it offers rewards in the form of gift cards. I use a credit card with no annual fee and because we pay off our balance every month, we do not incur monthly fees. If I have to pay a fee to use the card, the benefit of using credit will be greatly reduced and possibly eliminated (depending on the fees that retailers charge). If that is the case, I will move to a cash only system.

Some financial experts have mentioned that larger retailers will probably not opt to charge the fee, but that many smaller retailers and service providers may. Make sure you ask if you will be charged any extra fees the next time you decide to use your credit card.

43 Comments

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Faye, it usually costs 2-3% for a business to process your credit card. I am hoping that this will not apply to a debit card, where it is about a quarter to process. Checks usually cost a business, and cash slows things down, so retailers have to figure out what method they want, and incent people to do so. Remember when gas stations used to charge an extra nickel per gallon at the pump...

jbwhite2
January 26, 2013 9:52 p.m.

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It would make me think twice about shopping at a store that charges a surcharge.

Dukefan1
January 26, 2013 9:55 p.m.

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I'd be happy to pay with a check to get a "cash" discount. Otherwise, my business will have to go elsewhere. I only use Amex or Visa & pay them off each month. Regardless, I hope all stores participating will post their policy prior to the checkout line.

drcyndimd
January 26, 2013 10:19 p.m.

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Fees charged to a business by the credit card companies have gone up over the years. Reward cards even more! Retailers are funding the rewards the card companies give their customers. Margins at retail are smaller than ever expecially higher ticket items such as appliances and TVs. Often the margin the retailer is getting is less than 10 per cent and if a customer pays with a reward card he has to give up 3-5% to the bank for CC fees even on the sales tax amount. Few customers know this! The banks pile on the fees and the retailer often time is left with less than the bank gets. There is a cost of doing business and someone must pay. Hidden fees are costing all us and this may be something we see more and more of in the future. As the old saying goes "Nothing is free"

WOLF EM
January 26, 2013 10:46 p.m.

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I look forward to seeing businesses trying to implement this. Its ridiculous. The fees that credit cards cost businesses are ALREADY in the price of goods. The stores that think they are going to get a quick 4% back are going to be really surprised how quickly business goes the other way. Unless the big stores decide to do this, and its really unlikely, if smaller businesses try this, they'll just go under. Its all been laughable. Everyone takes cards now, and everyone has adjusted the prices of their goods to make up for credit card fees.

CarZin
January 26, 2013 11:09 p.m.

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I think this is great...as long as it isn't charged to debit or check cards. Perhaps it will encourage a little more financial responsibility if people can reduce price by paying with money they actually have. (Though it does suck for those of us who choose to run money through the credit card and then pay it off so we can collect points or miles.)

rachel6
January 26, 2013 11:40 p.m.

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I've already sent this to my legislators asking that they add North Carolina to the 10 states that ban the surcharge. To me, this invites abuse.

I use a credit card rather than carrying cash for safety reasons. I'm one of those who pays it off every month so I incur no fee. I would suggest that those businesses who decide to do this will lose a lot of customers!

rebelbelle
January 26, 2013 11:44 p.m.

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Thanks for your feedback everyone. I am very interested to see how many businesses actually implement this surcharge.

As a small business owner myself, who sells products (coupon organizers and class dvd), I incur credit card processing fees with every online transaction. I simply adjusted the prices of online sales years ago to cover the extra credit card and online processing fees I incur.

I don't fault the companies that are now going to try and recover some of the cost of processing credit card transactions, but I will not pay by credit card if there is a less expensive cash/check option.

Faye Prosser - Smart Shopper
January 27, 2013 1:43 a.m.

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The odd thing is, people moved cc or debit card to do away with paper checks, this will probably increase the handling of paper by the banks, those who issue the cc's. Then they might raise bank handling fees again ...I feel like we're caught chasing our tail.

Faye, does this new fee that can be imposed apply to debit cards since they are often handled as 'credit' cards?

Nancy
January 27, 2013 8:36 a.m.

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Seems like most people are using CC to save them time and get rewards,, Or something for free... I see people using cards for a pac of smokes, a soda and a candy bar,,,, No one has cash anymore,, Well Attention,, You need to keep a supply of cash on Hand at all times,,, The govt and or terroist can shut down the CC system at any time,, CC are the mark of the beast