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---new credit card fees---

Posted by on Jan. 31, 2013 at 9:19 AM
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Take action to avoid new credit card fees

MILWAUKEE - In the past few days there have been a number of reports about added fees that may be charged if you pay by credit card.

Why are these fees being charged?

In the past few years, merchants have been paying card issuers like Visa and Mastercard, as well some banks added transaction fees when a credit card was used.

Up until now, merchants absorbed these fees.

However as a part of a major settlement with Visa, Mastercard, and some banks, merchants in many states, including Wisconsin, are now allowed to pass these costs on to consumers.

How will you know if you are being charged these fees and how significant are they?

Merchants and online retailers must post a notice if they will be imposing this fee for credit card purchases.

The fees are expected to be somewhere between one to possibly as high as four percent of your purchase.

But, consumer experts do not expect that all merchants will be passing these along.

The main impact is likely to be from smaller businesses who typically pay larger processing fees because they do not have the same bargaining power with card issuers and banks as some of the larger merchants.

How can we take action to avoid paying some of these fees?

Watch for signs or notices about these fees before you pay.

If you do not want to pay an added cost, pay with cash, debit, or with another card such as American Express or Discover.

These cards may prohibit merchants from passing these fees on to you.

Take action. If you have been charged a fee without being forwarned, demand a refund.

If you are dissatisfied with merchants who pass these fees on, speak up.

Let them know that you want these fees to be waived.

Remember, you have a choice in where you choose to shop and how you choose to pay.


by on Jan. 31, 2013 at 9:19 AM
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by Group Owner on Jan. 31, 2013 at 9:46 AM

New Credit Card Fees Kick in Sunday

Starting Sunday, merchants can impose a... View Full Size
PHOTO: Starting Sunday, merchants who want to impose a surcharge on customers paying by credit card will be free to do so.
Getty Images
Starting Sunday, merchants can impose a surcharge on customers paying by credit card.

Smaller merchants, says Detweiler, don't always know what they're paying in processing fees. "If you think your own credit card statement is confusing," she says, "take a look sometime at a merchant's credit card agreement with VISA or MasterCard." If she herself were a merchant, she says, she'd be hard pressed to figure out the right percentage to pass along to customers. "I wouldn't want to wade into those waters," she says.

By law, merchants intending to pass the cost along will have to post notices at check out informing consumers of the extra charge. Online merchants will have to post a similar notice to their home page.

Ten states prohibit credit card surcharges, so if you're making a purchase in any of the following, you won't have to worry about being penalized: California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma and Texas.

READ THIS: The Low-Down on Checkout Fees.

You also don't need to worry if you're paying by debit card, since those are excluded from the settlement agreement. Nor do American Express customers need worry: AmEx's contract with retailers forbids them from levying a surcharge.

Detweiler offers this advice to affected consumers: "Always have a back up method of payment," she suggests, so you can avoid paying the new charge. "Have a debit card, or slip and extra $20 in your wallet."

And also, she suggests, tell your merchant if you object to the new charge. "If enough consumers complain, a merchant will fear losing business and won't choose to pass the charge along. I don't think people are going to like being penalized for paying the way they want to pay."

Consumer Watchdog: Credit Card Surcharges Take Effect Watch Video
Understanding the New Credit Card Rules Watch Video
Making Sense of New Banking Fees Watch Video
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