Cashless / Credit Card Fee - A New One for Me

[cabanafrau]

Curious that a restaurant would go out of their way to leave a bad taste in customers' mouths. That kind of thing will actually deter a certain number of potential return customers from doing so. Considering how on the brink the entire industry has been the past few years you'd think someone would have the sense to handle things more subtly.

 

[Turn the Page]

One of our local businesses tries to spin it by saying they offer cash paying customers a 3.5% discount then say all advertised menu prices reflect the cash discount.

Well, no, now it is a fee.

It accomplishes the same thing but I find the spin annoying.

 

[tvguy]

All of the POS processors that we have talked with, had the option to charge a CC fee inside their program and it was up to us whether or not we wanted to pass the CC fee onto our customers. They hide it as a "Convenience fee", but it is in fact to pass on the CC fees.

Yes, I forgot about this. I had a project at my house that required a building permit. My agreement with the contractor said they would get the permit, but I would reimburse them. Well, the contractor elected to do it online and pay with a credit card rather than take a check down to the building department. That triggered a $21.57 "convenience fee" on top of the permit cost, a fee I also had to reimburse my contractor for.
Same if you choose to pay your property taxes here with a credit card, you get his with a 2.29% convenience fee, with a minimum of $1.95. And if you pay DMV fees online, they charge a 1.95% convenience fee or 2.1% if you pay in person at the DMV. So it HAS to be legal.

 

[MsChristy12]

One of our local businesses tries to spin it by saying they offer cash paying customers a 3.5% discount then say all advertised menu prices reflect the cash discount.

Well, no, now it is a fee.

It accomplishes the same thing but I find the spin annoying.

One of the taco places in LA we went to did the same thing! It was so annoying! Their food was good but because they did a spin like this, almost feel like like cheating the customers, we won't be going back.

 

[Dan Murphy]

Well, that is a strange one for sure, dad.

 

[_19disnA]

I agree with the OP, saying they do NOT take cash and then adding a fee to credit card purchases seems shady to me since for the vast majority of people those are the basic options on how to pay. At the least, I would probably not eat there again. Laws probably vary by state, but to add a fee for which there is no reasonable way to avoid it seems like a gray area to me. Seems odd someplace like a restaurant would go out of their way to tick off a certain percent of their customers. Generally, you have lots of choices where to eat, so seems strange they would do that. Why they didn't just mark-up all their prices by 3% to avoid this problem isn't clear to me.

I know our HOA recently started to add a 'convenience' fee but ONLY if you pay with a credit card. There is no added fee for paying by check through the mail which makes sense to me. I know locally when making some large purchases, I always ask now if the store adds a 'fee' to use a credit card. A few have specifically said they charge less if you pay cash, others say the price is the same. The other day a plumber was at the house to do some repair work. I asked about fees and he indicated their company does NOT charge more if you pay by credit card. I always ask now to be sure.

I would assume many businesses don't want to be bothered handling checks since too much can go wrong. When they process a credit card charge, they automatically get a confirmation it was accepted. Many places stopped accepting checks years ago since far too many would bounce a few days later and they got stuck trying to collect.

 

[Skippy918]

Would paying via debit avoided the fee?

 

[MsChristy12]

Yes, I forgot about this. I had a project at my house that required a building permit. My agreement with the contractor said they would get the permit, but I would reimburse them. Well, the contractor elected to do it online and pay with a credit card rather than take a check down to the building department. That triggered a $21.57 "convenience fee" on top of the permit cost, a fee I also had to reimburse my contractor for.
Same if you choose to pay your property taxes here with a credit card, you get his with a 2.29% convenience fee, with a minimum of $1.95. And if you pay DMV fees online, they charge a 1.95% convenience fee or 2.1% if you pay in person at the DMV. So it HAS to be legal.

This doesn't make sense to me. You sure they used the words "convenience fee" for in person payment? Because convenience fee isn't the same thing as CC processing fee or CC surcharge. Convenience fee can only be charged when the customers are using a nonstandard payment method. So if you're at the DMV, paying in person is a standard payment method and no convenience fee should be charged, let alone that's more than online? Something isn't right if that's true....

 

[mjkacmom]

It's almost certainly a violation of their contract with their POS provider. In almost all of those contracts it stipulates that you can't add a surcharge for cards. The only thing I can think of is if you can avoid the fee by paying as debit and not credit.

Where I live many restaurants and businesses are either adding 3% to credit card transactions of offering a 3% discount for cash.

 

[mjkacmom]

Yes, I forgot about this. I had a project at my house that required a building permit. My agreement with the contractor said they would get the permit, but I would reimburse them. Well, the contractor elected to do it online and pay with a credit card rather than take a check down to the building department. That triggered a $21.57 "convenience fee" on top of the permit cost, a fee I also had to reimburse my contractor for.
Same if you choose to pay your property taxes here with a credit card, you get his with a 2.29% convenience fee, with a minimum of $1.95. And if you pay DMV fees online, they charge a 1.95% convenience fee or 2.1% if you pay in person at the DMV. So it HAS to be legal.

I don’t know anyone who charges their property taxes here, it would cost a lot in fees.

 

[amcnj]

I haven’t run into this yet, but sadly am not surprised.

Years ago I was able to charge property taxes without a fee. But then the thinking shifted to government shouldn’t be subsidizing payers who use things like credit cards which result in a cost to the government.

I always get a chuckle out of the places (often government agencies) that call such things convenience fees. It is also “convenient” for them to have you do the transaction yourself online.

A relative had a similar experience paying rent. The complex changed the payment methods allowed, and now has no method of payment that does not cost an additional fee. I questioned if this was legal, given that housing is involved, but the renter didn’t want to rock the boat.

 

[MsChristy12]

Would paying via debit avoided the fee?

Depends on where you live. In almost all states, it is illegal to apply convenience fee/surcharge on debit card payment. I can't remember which rare state(s) that it is legal to charge a convenience fee regardless of card type.
Convenience fee - usually a flat rate. Surcharge/CC processing fee - % of sales (usually 3% but max 4%, legally)

 

[DizneyFamof4]

This doesn't make sense to me. You sure they used the words "convenience fee" for in person payment? Because convenience fee isn't the same thing as CC processing fee or CC surcharge. Convenience fee can only be charged when the customers are using a nonstandard payment method. So if you're at the DMV, paying in person is a standard payment method and no convenience fee should be charged, let alone that's more than online? Something isn't right if that's true....

Convenience fee and CC fee are the exact same thing to the bottom line. This is very common. Our DMV has a convenience fee if you pay online and if you go in person they have a CC fee, both are the exact same %.

 

[tvguy]

Something isn't right if that's true....

Hey, it's California. DMV didn't even start taking credit cards until 2019!!

https://www.dmv.ca.gov/portal/news-...-field-office-to-accept-credit-card-payments/

 

[MsChristy12]

Convenience fee and CC fee are the exact same thing to the bottom line. This is very common. Our DMV has a convenience fee if you pay online and if you go in person they have a CC fee, both are the exact same %.

I don't think you understood what I said. Are they both fees that businesses pass onto consumers? Yes. Are they the same thing? No. I never said businesses can't charge you both, but they must be precise which one they use for online payment vs in person payment method. They can't charge "convenience fee" for both, one has to be named surcharge or something else.

 

[MsChristy12]

Hey, it's California. DMV didn't even start taking credit cards until 2019!!

https://www.dmv.ca.gov/portal/news-...-field-office-to-accept-credit-card-payments/

Really?! That I'm surprised!

 

[kdonnel]

Our DMV has a convenience fee if you pay online and if you go in person they have a CC fee, both are the exact same %.

My DMV makes no sense.

If you pay online, the cheapest cost to them since it is fully automated and no people are involved, you pay a convenience fee.

If you go in person and take up the time of the employee, salary almost always being the largest expense, you are not charged any fee for any of the possible payment methods.

So they are basically encouraging you to cost the DMV the most money by paying in person.

I guess they are not a private company so they don't need to worry about being efficient and cost effective.

 

[tvguy]

I don’t know anyone who charges their property taxes here, it would cost a lot in fees.

Some people will do any thing for those credit card rewards. Which, of course, is why some merchants charge extra for taking credit cards, since THEY are the ones paying for your rewards, not the credit card company.

 

[soccerdad72]

My DMV makes no sense.

If you pay online, the cheapest cost to them since it is fully automated and no people are involved, you pay a convenience fee.

If you go in person and take up the time of the employee, salary almost always being the largest expense, you are not charged any fee for any of the possible payment methods.

So they are basically encouraging you to cost the DMV the most money by paying in person.

I guess they are not a private company so they don't need to worry about being efficient and cost effective.

Our state BMVs are subcontracted out to a private company.

 

[kdonnel]

Our state BMVs are subcontracted out to a private company.

I saw others mention that about their states. But in my case they are run and staffed by state employees.