Hacker News new | past | comments | ask | show | jobs | submit login

> You can't say "Get 2% if you use cash instead of VISA". (Notice that nobody ever advertises that?) Because VISA doesn't allow it.

> You also can't say "$1.99 + 20 cents processing charge" - no, the price must be listed including charges. (Notice that nobody every does this?)

We see these a lot in Australia. I wish they'd enforce the same pricing here for cash and card — I don't like to carry cash around, and I hate it that I have to pay a surcharge when paying by card.

We see a lot of those in Australia because the ACCC took on Visa/MC and won.


In Australia, there are two environments, the Visa/MC networks, and EFTPOS. EFTPOS is owned by the AU banks and is AU only.

A Visa or MC credit or debit card txn go via the Visa or MC networks.

An EFTPOS txn goes via the EFTPOS network, it's much cheaper.

In AU, the fees are regulated and must be disclosed to the user as an extra charge. Most businesses much prefer the EFTPOS network because it's much cheaper.

Until recently, the contactless environment didn't support EFTPOS, so it always used the Visa or MC networks. Same applies to Google and Apple Pay.

I remember being charged 5aud for paying by card at a hostel, being Swedish this was a very weird experience. While I do like the anonymity of cash, cards are very convenient.

I think it's fair to pay for convenience.

Definitely, but 5aud for a single low value transaction is a bit steep.

Well, there is a cost when you use your card.

If there is no price differentiation, this just means everyone has to share the cost, rather than the people who choose to use it

> I don't like to carry cash around, and I hate it that I have to pay a surcharge when paying by card.

So you think your use of a credit card should be subsidized by people who pay in cash?

People who pay in cash are subsidizing the store’s costs to handle cash. Paying employees to count the cash (usually after closing), putting it in the safe, distributing the cash to cash registers, refilling when they run out of change, paying for the security service (Brinks etc) to deliver cash to/from the bank, insurance against robbery...

Cash is not free for a store to handle. Stores pay transaction fees on credit cards, sure, but they save on all the costs of cash. A hypothetical store that takes credit cards only would not have any of these costs and their vulnerability to robbery/theft would be limited to merchandise and capital only, saving the cost of insurance against theft of cash. For some types of businesses (services rather than retailers), this makes their office a pretty unattractive target for burglars and eliminates employee theft of cash.

This is an interesting argument, but it is not backed up by actual store behavior.

Stores generally try to give extra charges for using credit cards, not the other way around.

It seems like the fair thing to do, should be to allow a store to do whatever it wants, and make these credit card requirements illegal.

So, it would be allowed for stored to charge extra for either cash or credit, whatever they choose, and the credit card companies would be forbidden from stopping this.

That seems to be what we have in The Netherlands.

It's common for online stores to charge a few percent extra for credit card payment (the base price usually applies for the most common form of online payment, iDEAL, which is cheaper, I guess because the banks cut out Visa/MC).

On the other end of the spectrum, there are some physical stores and restaurants (usually chains) that don't accept cash. They're allowed to do that, given that they state so very clearly upfront.

> "Cash is not free for a store to handle."

that's like saying opening the doors everyday to customers is not free. it's true, but misses the point. handling cash, like paying for utilities, is a fundamental cost of doing business, and so it should be, because the right to anonymity and privacy is woven into cash. not so much with electronic transactions, which are optional, alternative costs.

No, it's not a fundamental cost of doing business, and many businesses no longer so that.

Your argument is one for considering exposing the cost of any payment mechanism to the customers.

(Especially when the cost between different payment mechanisms differ a lot.)

Indeed. And if stores make their accounting and realize that cash handling costs more than credit card handling, they should be able to add a cash surcharge as well.

It just happens that they dont want to do that, because dealing with cash is cheaper

In many places, paying cash is faster than paying by card. Before contactless, with optimized (rounded) pricing, you would often get 3x the throughput (nowdays less) and for small transactions the fees were ridiculous (smaller with contactless).

I wonder how much more expensive credit cards actually are? Cash costs money/time to handle and deposit, it's easily stolen, and easy to commit fraud with (like the classic move where a drive thru employee pockets the cash from a sale without ringing it up)

One issue I know smaller retailers sometimes have is that it can take a long time to get cleared funds into their account.

One small cafe near a place I used to work said it usually took 30-60 days for funds to clear into their account after a card transaction. That, for them, was a major problem as it meant that they couldn't then pay their suppliers in a timely manner when cashflow was highly variable.

Then again, a bakery I visited that was in a small town said they'd stopped taking cash, as they got robbed some huge number of times.

The computerization of order taking and kitchen tickets would seem to make it harder to charge a customer without ringing it up? I know you could cancel it in the system, but that's gotta be counted somewhere where a manager is going to see it eventually?

Depends on how much you can trust your employees.

> So you think your use of a credit card should be subsidized by people who pay in cash?

I don't think it should be so clear cut like that. The credit card processing fees charged by the processor is a cost of doing business and should just be factored into the pricing without being explicitly passed on to a subset of customers. For example, a shopping centre or convenience store may have toilets that only a subset of customers would use. Should the customers who bought something without using the toilet be "subsidising the cleaning costs"? If a store offers online ordering, should customers who ordered online be "subsidising the rent of the physical store"?

If the toilets cost 3% of revenue, then yes they should charge separately for using the toilets.

Or rather, they should have the option to do so.

It's a valid business decision to NOT charge extra for the toilets, too. Just like shops usually don't charge people who are a bit slower in the checkout line more for taking up cashier time.

Guidelines | FAQ | Support | API | Security | Lists | Bookmarklet | Legal | Apply to YC | Contact