Timeline for How can a credit card company make any money off me? I have a no-fee card and pay my balance on time
Current License: CC BY-SA 2.5
12 events
| when toggle format | what | by | license | comment | |
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| Aug 21, 2018 at 16:22 | comment | added | azoundria | Makes sense. To me, the small businesses are incredibly valuable and I feel pretty strongly that the consumer has a responsibility to help level the playing field when they can by supporting the smaller player. | |
| Aug 21, 2018 at 4:05 | comment | added | mbhunter | @azoundria I pay cash (or check) for a limited number of payees, either because they're a charity or because I know that I'm already getting a substantial discount on the product. The rest get my credit card. | |
| Aug 21, 2018 at 0:13 | comment | added | azoundria | If the business is small enough, you can get a "goodwill" if you pay cash. They will do a bit extra or be willing to offer a lower rate. This is much more likely for service businesses. Part of that comes from the credit card fees they don't have to pay, as well as no worries about chargebacks or waiting to receive the money. If it's a small business that I trust and enjoy doing business with, I prefer to pay cash so I can support them better. | |
| Jun 27, 2017 at 14:42 | comment | added | TripeHound | Re. "as it's factored into the price": even if a retailer isn't allowed, and doesn't directly pass the fee on, they will -- implicitly or explicitly -- factor the fees into their prices. It will be a "cost of sale" (in a given % of transactions) and will help determine the price set (for all sales) to achieve the desired profit. | |
| May 28, 2016 at 6:52 | comment | added | nick | @mbhunter Of course, but 1) technically you do pay the fee, as it's factored into the price and 2) the CC company would never have gotten paid if you hadn't made the transaction using their card. Hence why credit card companies offer significant incentives and rewards for using their card. Often times you'll get a bonus just for requesting a second card, say for your spouse or child, because you've potentially doubled the transaction revenue they earn through your account spending. | |
| May 28, 2016 at 5:12 | comment | added | mbhunter | @nick As a customer I don't pay the transaction fee. The merchant does. | |
| May 28, 2016 at 5:05 | comment | added | nick | "They keep you around because you may at some point become less responsible than you already are" Not really, you're already a revenue-generating customer. Granted, they might not make as much off transaction fees as interest fees, but as a customer you still have plenty of value to the CC issuer. | |
| Mar 16, 2016 at 17:48 | review | Suggested edits | |||
| Mar 16, 2016 at 18:04 | |||||
| Feb 8, 2011 at 23:25 | comment | added | dkam | Whether a merchant can pass the costs of a transaction on to the consumer, is a regulated by national laws. It's perfectly legal (and common) in Australia to see a "%3 surcharge for AMEX / Diners" signs. | |
| Feb 7, 2011 at 8:08 | comment | added | mbhunter | If they discount the cash price, that's all right. But they're still not allowed to pass the credit card fee onto you. It's a subtle difference, but doing the latter is against their merchant account agreement. Now, whether the big signs advertise the cash price or the credit price is a gray area. | |
| Feb 7, 2011 at 3:47 | comment | added | bstpierre | "merchants aren't allowed to pass this fee on to you" -- many gas stations (at least in MA and CT) have different cash/credit pricing. | |
| Feb 4, 2011 at 4:44 | history | answered | mbhunter | CC BY-SA 2.5 |