With a settlement reached between Visa/Mastercard and U.S. Merchants, Visa and Mastercard agreed to lower fees paid by merchants. They also agreed to allow merchants to surcharge customers based on what type of card they are using.
For example, customers who use a Visa Signature card can be charged more than customers using a plain Visa card, etc.
So based on this settlement if (at the cashier) you pull out a card_name card, the cashier can charge you more.
Why?
Merchants pay different interchange fees depending on what card they use. Premium or high-cashback cards usually have higher interchange fees. These fees can go up to 4%. With the new settlement, the merchant can choose to forward the higher fees by surcharging the customer and having the customer pay more.
Will merchants do that?
Let’s see how all this pans out. I wonder if merchants are going to choose to upcharge the customer or stay within the status quo and eat the loss themselves. If I were the store owner I would be quite hesitant seeing some rich fellow checking out with a huge order and telling them “Hey, I see you got the card_name card so I’m charging you another 1% on your order. Your new total is….” That’s like throwing an egg at your richest customer. (BTW, I know not everyone who has the card_name is really rich 🙂
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