Posts Tagged ‘Card’

Credit Card Surcharges or Checkout Fees

Financial Reviews | Posted by Kiara Withers
Oct 20 2011

I’m currently on the road and just had an opportunity to dine out at a fantastic local breakfast spot. After placing my order and being told my total, I whipped out my Chase Freedom card, at which point I was informed of a $0.40 charge for using a credit card.

I was annoyed, but I was in a hurry and wanted to conserve my cash, so I had them go ahead and run my card. I also rationalized that, with the 5% bonus rewards on restaurants, it would end up being a push vs. using cash.

So what’s the deal with credit card surcharges? Are they okay? Well… According to Visa (details here):

A checkout fee, or payment card surcharge, is an unfair surprise fee that a retailer tacks onto a consumer’s bill when he or she uses a credit or debit card. Visa rules do not allow retailers to charge cardholders a checkout fee for using their cards, mirroring laws in 10 U.S. states.

In other words, not only does Visa not allow this practice amongst their merchants, but 10 states have actually outlawed such fees. And guess what? The state I’m in is amongst those that don’t allow it.

While this bugged me, it really wasn’t a big enough deal for me to pursue. But if I wanted to follow up on this, I could report them to Visa as well as to the state attorney general’s office. Will I bother? Probably not —

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Tags: Card, Card Surcharges
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Professional vs. Consumer Credit Card Offers: Do You Know the Difference?

Financial Tips | Posted by Jacob ONeill
Oct 02 2010

As a result of the Credit Card Accountability, Responsibility and Disclosure (CARD) Act, Americans have been given more clarity regarding the terms and conditions of credit cards. However, due to a lack of industry knowledge, many consumers still may not understand what they’re signing up for.

In the first quarter of 2010, issuers mailed out 47 million “professional” credit card offers, which are typically directed toward small businesses and entrepreneurs, according to the Oklahoma Examiner-Enterprise. Consumers, however, have been the ones receiving these offers in their mailboxes. Credit CARD Act regulations don’t apply to professional cards, so issuers can continue to hike fees and rates at their whim on any consumers who agree to such offers.

“By moving cardholders out of protected consumer cards into professional cards, banks are trying to recoup some of their lost revenue,” personal finance specialist Eileen St. Pierre told the newspaper.

Consumers can opt out of receiving these pre-approved mail offers by calling 1-888-567-8688 or visiting http://www.optoutprescreen.com. Taking the initiative to do so can spare individuals confusion over the difference between professional credit cards and consumer credit cards, not to mention the other hassles that come with junk mail.

Tags: Card, Credit Card
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Councils Charging For Paying Bills By Credit Card

Financial Analyst | Posted by Joseph Carr-Boyd
Sep 28 2010

A consumer group has criticised a number of councils and local authorities for imposing surcharges for people who wish to pay tax bills or other costs by credit card.

‘Which?’ magazine, using Freedom of Information legislation, found that 55 councils in the UK are imposing additional fees for those who chose to pay by credit card, with 12 adding 2% or more to the cost of services.

Two councils were also found to be charging for debit card transactions, which attract a much lower fee for the retailer than a credit card transaction.

Bath and North East Somerset Council were named amongst the worst culprits, imposing a surcharge of 3% on council tax payments, planning applications and many other services, if a credit card is used.

Credit card companies impose a fee on retailers, known as merchants, for handling a credit card transaction and it is that fee that councils claim is the reason behind these charges. The

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Tags: Card, Credit Card
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Credit Card Fraud Rocketed in 2009

Financial Reviews | Posted by admin
Feb 08 2010

Credit card debt that’s problematical can be one of the most depressing, and distressing issues that you’re likely to face in your financial life. But being told that you have credit card debt when you haven’t had the pleasure of spending the money must be even worse.

Yet that’s the situation being faced by an increasing number of credit card holders, according to new survey, published yesterday, from Javelin Strategy and Research, a San Fransisco-based company that describes itself as, “the leading independent provider of quantitative and qualitative research focused exclusively on financial services topics.”

It gives a whole new meaning to the term, “balance transfer credit card.”

Identity Fraud Soaring

The report shows that 11.1 million Americans were the victims of identity fraud last year. That’s a full three million more than in 2007. Back then, 3.6 percent of the U.S. population was affected, a figure that shot up to 4.8 percent in 2009. Javelin defines identity fraud as: “the unauthorized use of another person’s personal information to achieve illicit financial gain.”

The company believes that much of the increase may be a result of the economic downturn, and points to similar rises during previous periods of widespread financial hardship. But, even if it’s true

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Tags: Card, Credit Card
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Lowering Credit Card Balances

Financial Analyst | Posted by admin
Jan 29 2010

Significantly lowering your credit card balance can be like coming from behind to win the Super Bowl.  If you are thousands of dollars in credit card debt you may look at the score board and think there is no way out.  But think about some of the greatest comeback football games you’ve seen and you’ll know there is always hope.

Play Good Defense

Football players know you can’t win if you are behind in the game until you stop the other team from scoring. The same idea applies with lowering your credit card balance.  You have to stop the damage by going on an all out blitz and refuse to use your credit cards unless it is an emergency.  Set a budget and use cash to pay for food, clothing, and miscellaneous items.  Not adding to your debt is the first step in reducing it.  In the words of Will Rogers: “When you find yourself in a hole, stop digging.”  

Play Good Offense

To win a football game your offense must score more than the other team’s offense, they must stay ahead to win in the end.  In terms of lowering your debt you want to stay ahead by controlling your impulse spending so you don’t have to constantly play catch up.  Watch for mindless spending on things like trendy clothes, weekly pedicures, going out to eat and electronic gadgets. Track your spending and Read more…

Tags: Card, Credit Card
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Credit Card Companies–How They Make Money

Financial Reviews | Posted by admin
Jan 26 2010

People who are fortunate–or clever–enough to pay their card balances on time, and in full every month have for years enjoyed free credit card use. Recently, that happy situation has become more rare, but plenty of consumers still have the privilege. Meanwhile, those who belong to credit card rewards schemes actually receive valuable benefits just for spending.

But credit card companies aren’t charities, and somebody has to be paying for their premises, staff, IT infrastructures, dividends, executive bonuses, and so on. So how–at least in good economic times–do they make money?

Two Sources of Income

The credit card industry has two principle sources of income. First, there are the fees, penalties, and interest paid by those who are less good at managing their money, or who find themselves–sometimes through no fault of their own–in financial trouble. Earlier this month, the Wall Street Journal quoted one analyst who said that, in 2009, penalty fees alone reached $22.9 billion, up from $19 billion in 2008.

The industry’s second major revenue stream comprises so-called “interchange fees” (also called “swipe fees”). Toward the end of last year, the Government Accountability Office (GAO) conducted a review of interchange fee practices. Its report found that, generally, anything between one and three percent of the total cost of every transaction is taken by the credit card industry in swipe fees.

It gives an example of a $100 transaction from which $2.20 is deducted for these fees. Of this, $1.70 ends up

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Tags: Card, Credit Card
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