Credit card swipe fees settlement could pass along fees to consumers
Swiping your credit card to pay for goods or services has become second nature to most everyone in the United States, but if a proposed settlement of a multi-billion dollar lawsuit goes through, that swipe could cost you extra.
The potential settlement between several major credit card companies and millions of retailers nationwide centered around the swipe fees that merchants pay each time a customer makes a credit card purchase. That settlement would allow businesses to pass along those swipe fees to you.
There is still disagreement on what it all means for consumers at large, but if the fee ends up being passed on to you, the result could be a few extra dollars tacked onto your purchase just for the luxury of using plastic.
"Arguably, customers are already paying for this," Trish Wexler, a spokesperson for the Electronic Payments Coalition, said. "The fact that retailers will not be able to run around and charge their customers an additional fee...is a little bit outrageous."
Experts believe that the additional fee would fall between 1.5 to 3 percent of a purchase if you use a credit card. The change wouldn't apply to debit cards.
However, passing that swipe fee along to the customer could be challenging, others say.
"Most merchants compete by lowering prices and being cheaper than the next guy," National Retail Federation Senior Vice President Mallory Duncan said. "You're much more likely to see merchants giving discounts."
We already see these kinds of discounts in some situations; for instance, a litany of gas stations nationwide offer a certain amount of money off per gallon if you pay in cash.
None of this is yet set in stone, however. The judge in the case must still approve the settlement, and that may not come until the end of the year or even into 2013. Implementing the fee faces additional challenges as well, including the varying swipe fees that different cards handle.
Ten states outside of our region also already completely prohibit this kind of surcharge, and there's always the chance that more could follow suit.