A few days ago I wrote about some of the technical aspects of using a credit or debit card, and how the process works - the machine, the card, ect. You can read the full article here.

In the post, I wrote that there is occasionally a "minimum charge" on some purchases because of a processing fee. This is something a lot of us just accept, and I thought it was reasonable. Then on Saturday I went out with a few friends, and my outlook changed a bit.

As young twenteysomethings we stepped out looking fresh, hit up an Asian restaurant and bounced around to a few different places afterwards. At the end of the night, when it was time to pay my bill of $6, I offered the waitress my credit card,  she looked at me kind of confused, and then let me know that there is a $10 minimum on purchases at this establishment.

Now, when the difference is between $4 and $5, its easy to say, oh its only a dollar difference, no big deal. But when you're looking at a 40% surcharge on a purchase, there's a problem. Wanting to get home and get to bed, I closed out and left, but the next morning I did a little research on the legality of these fees.

Teh internets have been afire in recent months about this very topic, and the majority of the sites and articles that I've found about the practice (from MSNBC, the Consumerist, and others) decry this practice as illegal!

The Consumerist contacted VISA, Mastercard and American Express and this is what they gleaned:

Regardless of who the merchant uses to process credit card transactions, merchants that add a surcharge or require a minimum purchase to accept a Visa or MasterCard credit or debit card are violating their merchant agreement, and you should report them to the bank that issued your card.

American Express does not forbid minimum purchase requirements, but they require parity with the other credit cards, so a minimum purchase requirement just for American Express, but not for Visa, is not allowed. American Express does not allow surcharges, unless they are assessed as a convenience fee...

Convenience fees are allowable surcharges for specific types of payments, generally to schools and government entities (like taxes or fines).

Asking for ID is not prohibited, but refusal to show ID cannot, by itself, be a reason for the merchant to halt the transaction.

To impose a minimum purchasing limit is a clear violation of VISA and Mastercard policies (if you are with a different card carrier, check your policy, or google it) and (at the very least) is shady!

So, what do you do when you get into this situation?

• A guy in Washington was so fed up with being charged wrongly, he formatted a wallet-size copy of VISA and Mastercard's policies which explicitly state that minimum limits are not allowed by their policy. Go to his site, print one out and show it to your server and inform the manager that they are in violation of the card issuers policy if they attempt to impose a minimum fee.
• If they still won't budge, you still have to pay your bill. Using TDECU's iPhone App, find an ATM and get cash from an ATM. However...
• Report them! Call the number on the wallet card or email your card issuers customer service and inform them that a business utilizing their service is imposing fees on you, a card holder. Follow up and make sure that the business is contacted.

I've tried to make sure that all the information in this post is accurate - I've researched card issuer websites, independent blogs, news articles, and forums and arrived at the conclusion that this practice is a clear violation of their policies. If you find information that is to the contrary, or that sheds more light, please leave it in the comment section!

DeAndre'

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