Posted by: SWL | January 25, 2013

More Hits to Your Wallet: Credit Card Transaction Fee Starts Sunday, Postage Increases Monday

Two more hits to your wallet are scheduled to take affect in the next few days.

New credit card fee
This could affect virtually everyone. Starting Sunday, merchants (stores and online merchants) can choose to add a fee of up to 4% of the purchase price onto any transaction made with a credit card. Some merchants may chose not to charge the fee. Any retailer that does must have a sign at their door/notice on website homepage stating that they are including the fee and what the percentage is.

A debit card will not incur the fee if used to debit the amount directly from your account. If you use the debit card credit option, you will be charged the fee. Cash and checks are free from any extra fees.

For years, VISA’s agreement with merchants included a clause that retailers could not pass on the fees VISA charged them for each transaction and could not have differing prices for cash and credit. (For some reason gas stations were exempt). Larger merchants, such as Wal-mart, have fought this VISA mandate for years. This agreement settles the squabbling.

update: Ten states already have laws prohibiting these fees: California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma, Texas. Some experts say this will start slowly, but will become common. Others think few merchants will ever charge the fee.

Postage rates
The increase is effective Monday. Mailing a first-class letter will cost 46 cents, up a penny. Letters to international destinations will go from 85 cents to $1.10. Flat rate box rates will increase as well. The cost of a small box increases 65 cents. The large box will cost an additional $1.40!

I have resisted paying bills online because as fewer people use the Postal Service, they cut more services – and I like having options. But another increase in postage is putting another proverbial nail in their own coffin. While at the PO today to mail some letters before the price increase, I saw an entire rack of Christmas merchandise on sale. The item that especially caught my attention was a cookies for Santa set (mug, plate, cookie cutter). If the Postal Service would concentrate on the mail instead of trying to be a retail store, the clerks at the counter could process customers more quickly and maybe USPS would lose less money.

The bottom line
These increases in consumer costs, along with food and gasoline prices increasing dramatically in the past two years, add to inflationary pressure on the US economy.



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