New York State and credit card "checkout fees"

credit card cornersFinancial services regulation fact of the day: starting this week merchants around the country are allowed to charge customers a "checkout fee" for using a credit card (even if many won't necessarily do so), as a result of a multi-billion dollar anti-trust settlement with Visa and Mastercard. But there won't be fees in New York State. [CNN] [NYT] [Consumerist]

Why? Because New York is one of 10 states that prohibit such fees. From the state code:

No seller in any sales transaction may impose a surcharge on a holder who elects to use a credit card in lieu of payment by cash, check, or similar means. Any seller who violates the provisions of this section shall be guilty of a misdemeanor punishable by a fine not to exceed five hundred dollars or a term of imprisonment up to one year, or both.

What New York doesn't prohibit: offering customers a discount for using cash, as some gas stations do*. It also doesn't prohibit minimums for using a credit card, though retailers have to notify customers of the minimums. And the minimums -- typical upper limit is $10 -- have to apply to all types of credit cards. The allowance of minimums is relatively recent -- a 2010 federal law opened the way for them. [Consumerist]

The structure of the transaction fees that businesses pay credit card companies is... complicated, and there's an argument that it results in a "reverse Robin Hood" effect, with people who use credit cards -- especially rewards cards -- being subsidized by people not using the cards. [NYT]

* There's a bill in the legislature that would prohibit this price difference at gas stations -- but it would also allow the stations to pass along the credit card transaction fee to consumers. (It's aimed at cutting down on large gaps between credit and cash prices -- like a $1 gap in Long Island last year.) [Newsday]

[via MeFi]

Comments

Giant step backwards. We should be moving toward a cashless society (money is filthy, people kill for cash, cash fuels an untaxed underground economy, etc) but this will reverse it. I have chosen not to do business with any gas stations that hide these surcharges as cash discounts, and I will do the same for any other merchants that want to penalize me for not wanting to have lots of cash on my person all the time. I would urge folks to immediately apply for a concealed gun permit, with the legitimate reason that you will be carrying large amounts of cash and will need the ability to protect yourself. If you have no criminal record and a few friends or relatives as positive character witnesses, the government will have no choice but to grant the permit. Then lets see how pissed these same politicians get who wanted stricter gun control.

Say Something!

We'd really like you to take part in the conversation here at All Over Albany. But we do have a few rules here. Don't worry, they're easy. The first: be kind. The second: treat everyone else with the same respect you'd like to see in return. Cool? Great, post away. Comments are moderated so it might take a little while for your comment to show up. Thanks for being patient.

The Scoop

Ever wish you had a smart, savvy friend with the inside line on what's happening around the Capital Region? You know, the kind of stuff that makes your life just a little bit better? Yeah, we do, too. That's why we created All Over Albany. Find out more.

Recently on All Over Albany

A quick recap of the week

Here are a few highlights from the past week on AOA: + We talked with the creator of the Troy Poem Project. + Cristin offered... (more)

Symbolic change

It's been about two years since a change in New York State law required the more-active disability symbol on new state signage. But for whatever... (more)

Reasons to improve walkability

Not local, but it touches on many of the topics we all end discussing here: An international engineering/design firm recently released an overview -- "Cities... (more)

The Capital Region leads Upstate in job growth

The Capital Region led Upstate New York* in employment grown between 2009 June and 2016 June -- that's from a new report by the state... (more)

The Creative Life at UAlbany: Joyce Carol Oates, Savion Glover

UAlbany announced a new series -- "The Creative Life" -- this week that's bringing Joyce Carol Oates and Savion Glover to the university this September... (more)

Recent Comments

... I think a competition would really help to open everyone's eyes to the real potential of the site. Too much time has been spent with typical, antiquated ideas. Let design professionals with new ideas have a crack at the site and you'll be amazed at it's potential.

Tacos at Oaxaquena Triqui

...has 26 comments, most recently from -S

Adapting to the Madison Ave Road Diet

...has 9 comments, most recently from JayK

Madison Ave Road Diet, now lined up

...has 25 comments, most recently from Bill

Today's moment of yarn

...has 2 comments, most recently from Tam

How to move forward at 1 Monument Square?

...has 2 comments, most recently from Reasonably Qualified