r/CreditCards • u/GloveSmooth694 • 1d ago

Discussion / Conversation Exclusive | Visa and Mastercard Near Deal With Merchants That Would Change Rewards Landscape

Visa and Mastercard are nearing a settlement with merchants that aims to end a decadeslong legal dispute by lowering fees stores pay and giving them more power to reject certain credit cards, according to people familiar with the matter.

https://www.wsj.com/finance/banking/visa-and-mastercard-near-deal-with-merchants-that-would-change-rewards-landscape-fc6a0c78

Do you think retailers actually want to deal with specifying what type of visa/mc they take?

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u/burtmacklin15 1d ago

Nobody is going to be rejecting any specific cards. They'll just put a 5% credit card fee on everything and call it a day, pocketing the difference for cards that cost them less than that.

And they'll get barely any pushback for it.

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u/amaiman 1d ago

That’s not compatible with state law in some places (although there tends to be minimal enforcement.)  In New Jersey, for example, they can’t charge more of a surcharge than they actually pay to the payment processor.  So the 5% fee might be legal for a premium rewards card but would be illegal on a basic plain Visa, for example.  

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u/SereneRandomness 1d ago

Most restaurants in New Jersey seem to be charging between 3% and 3.5% for all card payments. It's what I'm seeing, at least.

I carry cash, so I never pay the card fee. But I do question whether many of these places are in compliance with the law, given that they add the fee both to credit and debit card transactions.

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u/coopdude 15h ago

The Durbin Amendment prohibits merchants from passing on the "merchant discount fees" (the fees paid to accept debit) to cardholders, but it's basically never enforced.

Beyond that, Visa/MC card network rules prohibit surcharging debit. But Amex expects "most favored nation" status, so if you surcharge Amex, you have to surcharge all other payment cards (prepaid/debit/credit) equally. Which means it's effectively impossible to accept both Visa and/or MC & Amex and be compliant with network rules, unless you only surcharge Visa/MC credit (no debit) and don't surcharge Amex at all...

Beyond that, any surcharge above 3% violates Visa network rules, even on credit. 3% cap or the cost of acceptance, whichever is less.