This question might be subjective, but I would like to listen to opinions, if possible.

Ever since I got mugged on campus, I only carry enough cash to pay for bus travel.

All other payments are made using my debit card.

Last evening, when I was paying for a $1.67 item at a dollar store, I used debit card, and the person behind me became very excited and suggested that I settle using cash from now on, for such low amounts.

Does using cards always tend to portray a sense of superiority or some kind of a "show off", specially when low amounts are involved?

I never meant to project such an attitude, but I use cards because it provides me security, convenience of not having to carry around coins and cash and I don't even have to sign for such low amounts.

Is this not proper etiquette?

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    My response would have been no problem I will shop elsewhere from now on. – user4127 Sep 19 '11 at 13:23
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    Here in North Carolina it's pretty standard to see merchants post signs saying "Less than $XX and we add x-cents onto the bill". I have no problem in paying for the convenience of using the card. – gef05 Sep 19 '11 at 13:26
  • Seems that using a debit card is better than a credit card for small charges. The debit cards that I use do not require me to sign for purchases less than $10 and hence actually decreases the time I spend in line as none of us has to fiddle with coins. Thanks for all the in-depth answers, but only one answer can be chosen :-( – f1StudentInUS Sep 19 '11 at 16:47
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    @Chad I thought it was another customer complaining, not the shop staff. – poolie Sep 24 '11 at 21:43
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    @poolie - Ahh I see. Well that is free speech for you :) – user4127 Sep 26 '11 at 13:30

11 Answers 11


Until the CARD act, credit card rules required that merchants had no minimum purchase requirement to use a card. New rules permit a minimum but it must be clearly posted.

Update - Stores can now refuse small credit card charges is an excellent article which clarifies the rules. It appears that these rules apply to credit, not debit cards. So to be clear - the minimum do not apply to the OP as he referenced using a debit card.

"Superiority"? Hm. I'd be a bit embarrassed to charge such small amounts. Although when cash in my wallet is very low, I may have little choice. Note, and disclaimer, I am 48, 30 years ago when I started using cards, there were no POS machines. Credit card transactions had a big device that got a card imprint and the merchant looked up to see if your card was stolen in a big book they got weekly/monthly. Times have changed, and debit cards may be faster, especially if with cash you give the cashier $5.37 for a $2.37 transaction, but the guy entered $5 already. This often takes a manager to clear up.

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    I use my debit card for almost everything. I do carry a small amount of cash for emergencies, tips, and small purchases but I would not hesitate to use my debit card for this. Although If i need to use a credit card for it I would reconsider if the charge was for something I need or something I just want. I would not charge something small like that if it was just a want. But if i need some fluid to make my car work or have some onter need and did not have any cash I would be willing to charge as well. – user4127 Sep 19 '11 at 13:27
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    @Chad - keep in mind - using a credit card does not mean you have no money to pay in full. For some, the card provides a easy way to get one bill at month end, and whatever rebate/bonus points/etc the card offers. It's not like these 'want' purchases are all getting financed month after month. – JTP - Apologise to Monica Sep 19 '11 at 14:15
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    @JoeTaxpayer - Certianly that is true for some. And that is how the credit card companies want you to think. If you are disciplined enough to do that it is good for you. I personally (and I doubt I am in the minority) find it to tempting to over spend if i use my credit card as my primary source of payment. I was not saying the OP should not simply my philosophy is if I do not have the money(in my account) to pay for it I do not get want items. It keeps my credit card balance low and my savings rate much higher. – user4127 Sep 19 '11 at 15:29
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    Yours is the most factual, well researched answer from all the great ones I had to choose from. This forum is great! – f1StudentInUS Sep 19 '11 at 16:44
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    @f1StudentInUS - I appreciate your kind words. It's no coincidence that one of the first searches on this topic led me to an article at MightyBargainHunter's blog. mbhunter is among the fellow PF bloggers I'm proud to associate with. There are few, if any, topics that some here can't address. – JTP - Apologise to Monica Sep 19 '11 at 18:05

Generally, I consider it bad etiquette to inconvenience others. I would recommend cash for small purchases. Try to offer as close to the required amount as possible. Don't pay with several dollars worth of change if you can avoid it.

  • Credit/debit cards tend to take long to process than cash. The longer your transaction takes the longer those in line have to wait.
  • Merchant fees tend to be related to average size of the purchase. Merchants with lots of small transactions tend to pay higher fees. As the merchants pass as much of the cost on as they can you are contributing to higher costs for everyone.

You shouldn't need to carry a lot of cash. When you do don't make it obvious.

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    The cards that I use do not require me to sign for purchases less than $10 and hence actually decreases the time I spend in line. – f1StudentInUS Sep 19 '11 at 3:55
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    Right, my card is now no-signature and a non-contact wave under about $100, so it's definitely getting faster. – poolie Sep 20 '11 at 23:45
  • "I consider it bad etiquette to inconvenience others" While I agree with this statement in general, you have to remember that sales associates are there to help you. It's their job, which is why they're being paid to do it. It's certainly important not to be rude or disrespectful, but I'm not going to think twice about politely asking a sales associate, or waiter, or barkeep, or secretary, or whomever to assist me when that is their duty to the company they represent. – zzzzBov Jun 23 '14 at 23:50

Etiquette or not, it is hurting the seller. The transaction fees have usually minimums, so if the actual transaction is below the minimum - they'll pay larger fee on the transaction (relatively).

As an example, assume minimum fee for a debit card swipe is 20 cents, or 2% of the transaction.

For a transaction of $10 and above, the fee will be 2% of the transaction. But for $1.67, the fee becomes 12% of the transaction. 6 times more expensive for the seller. Basically, the sale was most likely at a loss for them (they usually have very low margins, especially for a "dollar" store).

So take that into account as well.

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    The merchant did this to themselves by accepting credit cards in the first place. – mbhunter Sep 19 '11 at 14:02
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    The retailers make business decisions. Some they make money on outright some the lose with the idea that in the end they make more than they lose. And your 6 times more expensive for the seller is wrong. On $1.67 their cost = .20 on $10.00 there cost = .20 so it costs the same. a 9.99 purchase would likely cost them 6x more though. – user4127 Sep 19 '11 at 15:35
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    @littleadv you gave the 6x in your answer – user4127 Sep 19 '11 at 21:05
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    @Chad - I asked you where did you get the 6% from, not 6x. If you can't distinguish between "6%" and "6 times more", then you have a bigger problem than just not being able to understand English. – littleadv Sep 19 '11 at 21:32
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    @gnasher729 the question was about the payment method, not a decision whether to make a purchase... If mere acceptance of a credit card will make you buy something - you're in a bad shape... – littleadv Jun 3 '14 at 2:27

I don't carry cash at all unless I know I'm going somewhere which requires it - this includes going to the corner shop for some milk or going to other countries for a week.

Cards are easier for me - if a merchant wants my business they will take my money through whatever means they can.

I don't think etiquette comes into it.

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    A small retailer will have to pay a couple of fees to accept your card. A national chain has lower fees and better chance to deal with that cost over a mom and pop. It might be polite to the mom and pop to go with cash. – MrChrister Sep 18 '11 at 22:25
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    If they can't accept cards and post a sign saying they won't, then that's fair enough. I won't shop there unless I have cash for some reason. And as nowhere accepts Amex I wouldn't try to use it anywhere, but to be honest it isn't handy for me to use cash so I don't. – Rory Alsop Sep 18 '11 at 22:38
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    @MrChrister - While I agree that it is "Polite" to pay cash for small purchases at a mom and pop store. I do not think it is impolite not to. They have business decisions to make too. Have little doubt that if Walmart thinks it will make more money putting a minimum purchase amount that it wont do it. For the mom and pop they offer the convience to their customers hoping to get more business and knowing they will have to eat some costs. They reason that the costs will be offset by increased sales. – user4127 Sep 19 '11 at 18:03

A lot of stores, especially smaller ones, won't accept card payments under $10.00. They pay a fee for taking cards and for small transactions it is not worth it.

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    I've also heard that if you use a credit card to pay for gas, the station owner often actually LOSES money on the transaction because the credit card fee more than eats up any profit they would have otherwise made. Those stations make money on the stuff you buy inside(exclusive of cigarettes, which is the same deal). – JohnFx Sep 19 '11 at 2:03
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    @johnfx - that is not really true. While they do pay a fee the fee is generally figured into the cost of pumping gas. Some stations have different prices for Cash than Credit cards. What the stations lose out on with pay at the pump is the traffic in their stores so they are selling less of their overpriced drinks and snacks. – user4127 Sep 19 '11 at 13:21
  • @Chad Source: msnbc.msn.com/id/23904590/ns/business-retail/t/… – JohnFx Sep 19 '11 at 13:28
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    @JohnFx - Yes they are losing money because they choose to offer gas at a price below cost to get shoppers in the door. It is the pay at the pump that is costing them money not the creditcards them selves. So next time the reciept doesnt print and it says please see cashier realize that is a business decision not to stock their reciept printer. – user4127 Sep 19 '11 at 15:38
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    I would argue that gasoline is a largely undifferentiated and highly available product so that the retailers are, in economics terms, price takers. In plain English, market forces are driving retail gas prices, not the individual retailers. – JohnFx Sep 19 '11 at 19:31

It's fine. Some people (including myself) charge any amount, no matter how small. I think charging small amounts is encouraged by no longer having to sign for small amounts (Not sure if this is state-by-state, though).

Somewhere, the transfering of digital money is being paid for - either in the merchant fees, an ATM fee, or my time in going to a bank or ATM where I will not be charged a fee.


Personally, I think it's a bad practice, because ultimately using cards for such minuscule transactions raises costs for everyone, especially at merchants whose average transaction is small.

How does carrying cash improve your personal security? If someone is going to mug you, they do not know in advance whether you have money or not.

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    Seems that using a debit card is better than a credit card for small charges? From my personal experience, emptying your pockets before you get hit with a bat can sometimes alleviate the later. If you have nothing to loose, there is no need to strike back. That also reduces the possible co-pay of a handsome medical bill. – f1StudentInUS Sep 19 '11 at 16:50
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    -1 Actually the more transactions like these that are processed will prompt the creation of more effiecent processes and more competitive card processors. In the end using the card for these purchases drives down the cost of using cards all around. – user4127 Sep 19 '11 at 18:06
  • @Chad - what are you basing your speculation on? The merchant fees market is not competitive and the fees are more or less the same, dictated by Visa/MC/AMEX. While some merchants can chose not to accept AMEX because of the high fees, rarely a merchant can afford not accepting credit cards at all. Even the cheapest clearing service will have minimum fees, so there are always going to be transactions more expensive to the retailer than others. – littleadv Sep 19 '11 at 19:11
  • @littleadv - Read Economies of scale. Where there is a need and a product to fill it the need will be filled. If a bank sees a niche where it can make 6% of a large number of small transactions plus suck some of the 2% of the large fees and still make money then it will step in and fill that gap. So there you have cut it in half. Its called capitolism – user4127 Sep 19 '11 at 19:24
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    @Chad - again, you seem to be confusing clearing business with Visa. There are many clearing businesses, and many issuing businesses, and many that do both. BUT the fees are not set by them, they only set the extra for themselves. The interchange fees are set by Visa, and no clearing business will charge merchants less than the interchange fee, for long-term. You can argue as long as you want that you read some book and it says otherwise, but I've worked in the industry and I know exactly how it works. – littleadv Sep 19 '11 at 21:36

Intellectually and logically, it shouldn't bother me for a second to charge something for a buck. It's a losing proposition for the merchant, but their immediate business costs should be of little concern to me. (They're making a choice to sell that item to me at that price and by accepting that means of payment, right?) but the more I charge as opposed to paying cash, the more cash back I get.

In my old-ish age, I've gotten a little softer and will pay cash more often for smaller amounts because I understand the business costs, but it's not a matter of caring what other people think.

Accepting credit cards, or not, is a business decision. It's usually a good one. But with that decision come the rules, which up until about a year ago, meant that merchants couldn't set a minimum charge amount. Now that's not the case; merchant account providers can no longer demand that their merchant clients accept all charges, though they are allowed to set a minimum amount that is no lower than $10.00.

In the end, it's a matter of how much you're willing to pay in order to influence people's thinking of you, because the business/financial benefits of doing one or the other are pretty clear.


Etiquette doesn't really come into the picture here. The business offers a service and I choose to accept it. Personally, I use my debit card as much as possible. For every transaction, I record it in my checkbook. Then, when I do reconciling, I know exactly how much I paid for various categories of stuff. Good for budgeting. Most often my purchases are over $10 but when they aren't, I have no qualms about using the card.


First, you say you don't like being mugged, so stop using debit cards. Credit cards risk the bank's money, which also give them incentive to take fraud seriously. You don't have to pay the fraction of balance that is in dispute. Whereas, debit cards risk your own money: If fraudulent charges appear on a debit card, that money disappears immediately. Later, you find out about it and file a dispute, the money might return.

Now, there are two aspects to the discourtesy. First, people behind you having to wait. Debit card transactions are more time-consuming than credit card transactions, for two reasons: #1 they require more interaction (e.g. you entering PIN), and #2, they add complexity due to cashback - even if you don't take it, you have to hit "no". So ditch the debit - the people behind you will thank you.

Second, the merchant pays more than cash (but not quite as much as credit cards). A typical merchant fee for a CC or debit transaction is 25 cents + 1.8% of the amount charged. This means tiny amounts are painful for the merchant. However, as a matter of policy, some cheerfully accept it as a cost-of-doing-business because it reduces the risk of them getting mugged. So if it's a family store, ask the owner.


I would like to offer a different perspective here.

The standard fee for a credit card transaction is typically on the order of 30 cents + 2.5% of the amount (the actual numbers vary, but this is the ballpark). This makes small charges frequently unprofitable for small merchants. Because of this they will often have minimum purchase requirements for credit/debit card payments.

The situation changes for large retailers (think Wal-mart, Target, Safeway, Home Depot). I cannot find a citation for this right now, but large retailers are able to negotiate volume discounts from credit card companies (a guy who used to work in finance at Home Depot told me this once). Their transaction fees are MUCH lower than 30 cents + 2.5%. But you get the same reward points on your credit card/debit card regardless of where you swipe it.

So my personal philosophy is: large chain - swipe away without guilt for any amount. Small merchant - use cash unless it's hundreds of dollars (and then they may give you a cash discount in that case). And make sure to carry enough cash for such situations. When I was a student, that was about $20 (enough for coffee or lunch at a small place).

  • Note: Processing a debit card (when you have to put in your PIN) is almost free for a merchant. Don't feel a bit of guilt if they are able to let you enter a PIN. – Crisfole Jun 24 '14 at 2:02

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