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According to a new rule, one will be charged an additional 4% when purchases are made through Visa Card or Master Card. The news is more important for the retailers than the card holders, because the retailersare supposed to pay a surcharge to the card companies. In turn they would be realizing this money from the customers. In the New Year, We will allow the merchants to impose an extra charge on the credit card users. However, in the past, Visa never allowed the retailer to do so. The reason behind charging an extra sum An allegation has been made on “price fixing” and, hence, a $7.2 billion antitrust settlement is involved in the entire process. The deal demands a fee relief of $1.2 billion along with a cash payment of $6billion. Therefore the retailersare allowed to charge a little extra so that they can cover the cost of transaction. Rules for the store owners and merchants Store owners are supposed to pay a percentage of anywhere between 1.5 to 3 of the transaction amount to the card companies. This is to settle down price fixing. The implied meaning of this surcharge • Consumers will pay an additional amount but they should know that there are limits to this amount. • Retailers can charge an extra amount only if a consumer is making the payment through credit card, those paying through debit card or prepaid card would not be charged any extra amount beyond their bill. • A notification should be given to the customers about the surcharge, before they make a purchase. • Every receipt should entail the surcharge percentage on it so that customers re clear about it. States not falling under the norm Surcharging in California, Colorado, Connecticut, Florida, Kansas, Maine, New York and few more States are not included in this new rule. In case if any discrepancy a consumer is allowed to report the matter to the Attorney general of their State. The view of the merchants over the issue The card companies though have suggested that all the states should be treated equally and hence the surcharge should be implied to all of them. In fact, the retailers don’t want to face a loss and hence they want to find out ways to combat the new rule. However, they are allowed to come with “cash back scheme” so that they can extend a little comfort to the consumers. Most of the retailers have expressed their disinterest on charging the consumers any extra while they make their purchases. Summary: Even the verdict has been given by a Court in U.S., the credit card companies have welcomed the change, however, the merchants are not too willing to go with the flow and put an additional burden to the consumers. The retailersand the merchants are completely aware of the fact that the new change could have a negative impact on their business as it would pose an additional pain for the buyers. Justin is an experienced content writer provides finance management tips to solve all your financial problems in business. Read more articles related with credit card cheating and credit card.
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