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SALT LAKE CITY — Merchants in Utah and 39 other states can now charge you extra for paying with plastic.
The option went into effect this week to charge customers paying with credit cards more for their purchases. The cause for the new fee was a $7.25-billion settlement after Visa, MasterCard and nine major banks were accused by merchants of fixing credit card processing fees.
Credit card issuers said they would reduce swipe fees paid by merchants for eight months as a part of the settlement. Retailers were given the option to charge customers who use credit cards enough to cover processing costs — about 1.5–3.5 percent — according to CNN Money.
Debit cards are not affected by the settlement, and customers can also pay with cash or check, if accepted, to avoid the fee. Online, PayPal is also exempt from the fee.
Reports suggest that many retailers will refuse to add the fee out of principle.
Customers will be notified if they will be charged extra, and it is up to businesses to decide if they will charge the fee, according to Reuters.
Reports suggest that many retailers will refuse to add the fee out of principle. Retailers as varied as Wal-Mart, JCPenney, Gap Inc. and The Neiman Marcus Group all joined the National Retail Federation last November in claiming that "raising consumer prices by adding an 'interchange tax' is no remedy for Visa's and MasterCard's continuing monopoly abuse."
Both Wal-Mart and Target have said they thought the fee was a bad idea.
The 10 states not affected by the fee are California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma and Texas.
