Shopper Alert: Penalty For Plastic

11:18 AM, Dec 8, 2009   |    comments
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WASHINGTON, DC (Newspronet)--With the shopping season upon us, it's easy to rack up lots of big expenses.

But what happens if you want to buy something with a small price tag and put it on your credit card?

Odds are you've seen the sign posted before.  Five or ten dollar minimum for debit or credit purchases.

"My personal experience has been in multiple convenience stores," says one consumer taking a break from shopping.

"Where I usually run into a problem is at coffee shops. It is very
frustrating," says another consumer.  "Basically you're kind of, your hands are tied."

So what do you do?

"You look around you get gum, you get candy, things you really don't need at all just to make the minimum," says a consumer.

No one wants to buy more than they need, especially now in this tight economy.  Yet consumer advocate, Linda Sherry, hears complaints from across the country.  She says you shouldn't feel that kind of purchase pressure, because stores aren't allowed to require minimum purchase with most credit cards.

"They can't have a sign up there that says, 'If you want to use your credit card you have to buy at least $10 worth of stuff.' That is violation of the Visa MasterCard rules," says Sherry. 

It also violates Discover's rules too.  American Express doesn't prohibit it, but does discourage it. 

Some merchants justify the expense saying they have to pay a percentage of their sale to the bank, so they pass that expense to the consumer.

"Really the merchant just has to eat that cost as a cost of doing business," says Sherry.

Experts also say retailers can't charge a fee for using your card.  But Sherry says that happens too.

What can stores do?  Sherry says, "It's not illegal to offer a discount to people who are using cash."

What's the difference?  In this case, it's like passing on a savings, which the merchants are welcome to do to encourage their preferred payment method. 

What should you do if you don't want to pay cash or a minimum if a store keeper insists?

"I think you need to stand up for yourself and your rights and you should tell them very clearly that you know it's a violation and that you will complain to MasterCard or Visa about it," says Sherry.

Or, take your business somewhere else.

If you want to complain, check the number on your credit card and call the issuing institution to file a complaint.

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