Cumberland Times-News

February 18, 2013

Credit fees

Learning about them can help you avoid them

Cumberland Times-News

— The “checkout fee” some consumers in Maryland will now face when using a credit card is sure to bring confusion, if not consternation.

The fee became effective Jan. 27 and allows merchants to impose a charge of up to 4 percent of the purchase price when customers pay via credit card.

The Better Business Bureau of Greater Maryland said retailers pay an average of 2 percent for processing fees.

Larger retailers with national clout are able to negotiate lower rates with banks.

A U.S. District Court ruling now permits the merchant to pass the fee on to customers.

Maryland is now one of 10 states permitting businesses to impose the credit card fee. But the BBB notes that not all merchants are imposing the fee because it is not mandatory.

The BBB has several suggestions for customers who use credit cards for purchases in-store or online:

• Avoid the fee by paying with a debit card. Look for retailers who offer a discount for cash and check purchases.

• The fee is not mandatory. Small local retailers are most likely to take advantage of the checkout fees. National retailers are unable to do so since the ruling stipulates that the fee can only be imposed if all 50 states opt in.

• Look for public notices. The regulations stipulate stores must fully disclose that they are going to add the surcharge by posting a notice at the entrance of the store. However, you may not know how much the fee is until you reach the cash register.

• Online retailers only have to disclose the surcharge when they begin to collect your payment information.

• Different credit cards may have different surcharges. Not all retailers will pass on these fees. Keep up with who is charging what. For example, American Express is not party to this ruling.

• Check your receipt. In Maryland, the retailer cannot charge sales tax on the surcharge. Therefore, the fee is not tacked on until the total price and tax are figured. Disclosure of this fee is required by terms of the new ruling.

As always, it is buyer beware.

Following these BBB suggestions seem to be the best strategy for dealing with a credit card fee that apparently will be a normal practice from now on.