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American Express doesn't have to worry about this maybe because if you're using an AmEx it's probably safe to assume that a) a minimum purchase wouldn't be a strain on your finances and b) you're probably buying something that's more than a few dollars anyway.
Thank you for following up on this.
What I am to do?
Simply write a note to my financial institution?
That doesn't help me make my purchase, and I guess (at least around here) they can and sometimes do \"reserve the right to refuse service.\"
You might consider stating this fact to the person behind the register and see what happens.
Ben,
Thank you again for the follow-up.
I read with interest the more recent updates. I just don't see how \"stating\" this fact will help things.
I hate being a dick.
I just want my soda and candybar!!! (without having to use cash)
- \"American Express doesn't have to worry about this maybe because if you're using an AmEx it's probably safe to assume that a) a minimum purchase wouldn't be a strain on your finances and b) you're probably buying something that's more than a few dollars anyway.\"
Not true. American Express carries many \"normal\" credit cards. We shop almost exclusively with American Express cards because of their Delta Skymiles card. Since I travel for work, it makes sense to keep racking up the miles so that I can get a free vacation for the whole family.
Also, many companies use American Express as corporate cards, and oncorporate travel you have to pay with the card - or you are forced to do some long delayed re-imbursement procedure.
AmEx is no longer a status symbol like it once was...
Even if the stores let you buy that pack of gum with your credit card, you would just be paying extra. The credit card companies themselves have a minimum charge for you, usually $1. If you buy something under that, you would get charged the $1 anyway.
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claire333: Do you have a source for that information?
clair333: In my experience this is not true. Never have I noticed being \"overcharged\" to a dollar when paying less, and I use my credit cards for everything as I don't even carry cash.
Also, as far as American Express goes, I have read here and on other sites that AmEx \"discourages\" these practices (minimum charges, transaction fees) but does not outright prohibit them. AmEx DOES however prohibit discrimination against their cards by the merchant, meaning that if the merchant doesn't have a transaction fee or minimum amount for their Visa and Mastercard purchases (since they can't), they can't for AmEx purchases either as this would be discrimination against the card.
As far as \"bringing it to the clerks attention\" (posted by Ben P), I was just at my local store today and they refused to allow me to purchase the items I had brought to the counter with my Visa/debit that amounted to approximately $3.50. I brought to the stores attention that this was not \"legal\" (as I had just recently heard the story on the news)and I was told flat out that I was wrong and I was required to either leave without my purchases or peruse the store for something additional to equal $5+. The heat, gas prices (to run to another store) and truly needing the items caused me to go in and find and additional $2 worth of items and stand back in line to purchase my items.
I have created a list of merchants that impose minimum purchase requirements. At the moment, it's at [minimumpurchase.livejournal.com] , but there will soon be a more sophisticated website with a searchable database and all that good stuff. Join the fight!
@marnen:
Grow up.
Most of those businesses are mom and pop restaurants, which means the average bill is far above $5 or $10. The merchant is just trying to protect themselves from the customer whom orders a single diet drink, sits at a table for two hours at peak dinner hours and then stiffs the teenage waitress for a tip.
The merchants could implement an across the board $5 or $10 minimum. A minimum that must be paid by all customers even those paying cash. Such minimums are perfectly legal. Of course then you would whine about the minimum purchasing requirements. The merchant could just charge $10 for everything on the menu.. and give you an $8 discount when you purchase a meal with your $10 drink, but that would be a book keeping nighmare for a small business.
The bottom line is credit card companies raise merchant rates at will, add surcharges at will, and screwover the merchant on stolen credit cards. So why can't the merchant try to maintain a profitable business?
Don't like showing your photo ID? Tough. Stolen credit cards cost merchants more than employee thefts and shoplifting combines. I don't want to know your personal details, I am hoping the picture is a person of the same sex and race as the person on the other side of the counter and the names on the credit card and photo ID kinda of look the same.
Don't like a minimum purhcase? Tough. $3.17 is my current Visa fee for ANY credit card tranasction. Buy something for $2 and charge it to your credit card and I (the merchant)am out $1.17 plus the cost of the goods. Damn right I am going to charge a minimum transaction amount.
Here is he bottom line - any store that sets a minimum purchase amount for credit card purchases does so in violation of their contract with the credit card companies who have a restriction on this practice. And some have rather stiff fines to the tune of several hunderd thousand dollars for violations. That would certainly eat into the store profit more so than taking a $2.00 sale with a $3.17 fee [retail costs; not adjusted for markup and tax advantages].
Any store that sets a minimum purchase amount for all customers regardless of payment is also in violation of their credit card merchant agreement because there is still the improper setting of a floor minimum for the credit cards. This is still a violation of the merchant agreement even though check and cash customers have the same floor limit - since there is no contract stating that the store cannot have a floor minimum for cash and check transactions.
Fees for credit card transactions are a store operating cost and, like payroll and electricity, the store has to pay these costs of doing business. It may well be that a store has to raise prices on smaller \"convenience\" items to discourage small purchases [this is a convenience price, common in convenience stores]. Maybe the store elects not to carry low cost items to avoid having the cost of the sale exceed the profit earned. Maybe the store has to reduce overhead to afford the fees associated with accepting credit cards. Maybe the store should decide not to accept plastic at all.
If any store owner does not like the fees associated with taking credit cards then any such store owners should not voluntarily agree to take credit cards in their stores.
It is not the customer's fault that floor minimums are prohibited or that the store owner has agreed to take credit cards under an agreement that prohibits floor minimums.
Harry, you probably complain about how high prices are. You don't mind making Visa and MC rich enough to buy stadiums; however, don't let your neighbor who runs the mom and pop store make a decent living. People like you only care about yourself. I too like using my credit card on big purchases, but I don't get off on screwing a small vendor with anything under a $20 purchase. Think of others for a change.
No one forced mom and pop shop to accept credit card. If a store *chooses* to sign agreements with CC companies they should follow those agreements. How can you argue that it costs _ amount of money for transaction therefore customer should be required to obey by illigally set minimal charge. NO! store CHOOSES to take credit card to maximize their profits. They cannot have an egg and eat it too. Bottom line is charging minimal fee is dispicable and stores should be fined accordingly
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It's called the cost of doing buisness people.
My company grosses about $100M a year in credit card buisness, we pay about $3M in credit card fees. Just how it goes.
Set your sales margin's accordingly.
StevieD, You are getting screwed by whoever does your credit card processing. PayPal charges around $0.30 + 3% of the transaction per transaction. Depending on the amount of business you do and the type of transaction, you can get it to as low as 1.9%. For a virtual terminal, it's an extra $30 a month.
Bill, I do not think Harry \"gets off on screwing small vendors\". I doubt he is buying a pop to screw the store, I bet he just wants a pop, and the store advertises it accepts Visa/MasterCard as a form of payment.
All, Cash is not a \"fee free\" transaction. You need a cash register, counting equipment, the time it takes to give change and count the cash, and sometimes a service like Brinks to transport the cash. Also, there is a lot more risk with cash including incorrect counting, stealing/shrinkage, and counterfeit bills. Credit card dollars are nearly instant, and require much less back office work.
StevieD:
You are telling me that you are willfully violating the rules of the merchant agreement you signed -- of your own accord -- with the credit card company. That's inexcusable. If you don't like the terms of the agreement, get it changed or don't sign it. There are plenty of businesses out there that don't take credit cards, and they seem to do pretty well.
What's ironic is that you're saying you do this to save yourself money, but you're costing yourself business and goodwill in the long run. I won't patronize businesses like yours, and I daresay many others feel the same.
Finally, you claim that minimum purchase requirements are perfectly legal. Think again. As long as you have such requirements, you're in breach of contract with the credit card company, and they could take you to court, sue you, and most likely win.
A few stores I have been to have done away with CC/Debit transactions entirely. They purchased an ATM and put a $2 fee on it. problem solved for the most part. more than a few customers have walked out as a result but in the end they have more money from the fees.
Interesting. It's quite clear what a merchant should do. Allow credit card payments on everything, but post a sign saying \"50 cents off all purchases made with cash\" or something like that to cover the credit card fees. It looks like most of what the card companies are worried about is preferential treatment to the other cards, not so much about cash. Almost like... anti-competitive collusion...! From the credit card companies? Who would have thunk it...