Restaurant adding fee for use of credit card

[Morgan22]

Some have added that there is also a cost to handling cash payment (the counting, transporting, etc)

I would like to point out that once a business has decided to accept cash and assume those costs, they are sort of fixed costs. The counting and handling process does not get more expensive depending on how much cash was counted/collected.

Whereas the credit card fees do rise with sales as they are usually percentage based.

So unless a business goes cashless, then there is not really an additional cost to accepting cash.

Not true if you hire armored trucks. Back in '21 when I was dealing with that side of the business, they had a minimum of pickup charge of $600, (which was going up to $1k last I heard) and other misc charges, on top of the % they charged for each dollar they transported for our business. It was so costly, as were our lockboxes for checks received by mail!, we were encouraging our customers to pay by credit card, or even better direct ACH if billed.

 

[pb4uski]

.... it just seems wrong to be passing this on to the consumer. ...

I disagree. Restaurants pass on the cost of food, supplies, labor, overhead, and taxes to the consumer.... why should this be any different and any other cost that they incur. Imposing it on those who use credit cards is simply passing it on the the customers who use credit cards which causes the restaurant incremental costs. Seems fair to me to include it for those who use it and exclude it for those who pay cash.

I get a 2% rebate so the net impact to me is negligible. I think it is more fair to those who pay cash compared to baking it into the menu prices since the credit card users (like me) wold benefit to the detriment of cash users.

Anyone who is upset about this needs to find themselves a hobby.. I suggest golf.

 

[Murph]

More and more restaurants seem to be adding a fee if you use your credit card. I've seen this be upwards of 3%. I know that the CC companies charge a transaction fee, but it just seems wrong to be passing this on to the consumer. I don't like carrying extra cash. And it is much easier to track spending by categories when using a CC. Is anybody using their debit cards instead which usually does not incur the extra fee?

I know I’ll get skewered for this, but when I see that charge I deduct it from the tip %.

 

[Ferd]

If I'm getting 3% cash back and they are charging a 3% CC fee then it's a wash. If it's more than 3% then I might consider going elsewhere. The places I've seen doing this don't distinguish between credit and debit cards, only cash avoids the fee. I never use debit cards even though the banks claim they will protect you, I don't trust them. Credit card protections are federal law. Banks can change their terms anytime they want to and bury it in 4 point print.

 

[ychuck46]

Only one of our favorite restaurants is doing this, and he is a small operator who keeps his prices very reasonable. I don't mind his 2-1/2% surcharge because he is very fair to start with, and essentially we split the difference, since I get 5% cashback on my CC. When the big chains start doing it I will pass on them.

 

[jazz4cash]

I have enjoyed getting a free ride by using a CC and collecting cashback for a long time. I used to ask routinely for a discount for cash but almost no-one does that anymore. Yeah the cost for using CC has been baked in for a long while but with recent inflation it seems reasonable if merchants can use a surcharge to hold prices down a bit. I finally encountered a 3% surcharge so I used debit for the first time in years. I had picked an auto repair shop that was $50 cheaper than my regular shop. I guess that is part of why they charge less. When I dropped off the car I saw the surcharge notice and panicked because it had been so long since I actually used my debit card! I don’t even need it for those rare ATM withdrawals.

 

[Aerides]

I know I’ll get skewered for this, but when I see that charge I deduct it from the tip %.

Please feel my skewer - you penalize the lowest person on the chain who has no control over this policy at the restaurant. Just don't go back.

 

[Texas Proud]

I was talking to my oldest sister and she was mentioning that when cable first came out the big advertised benefit was NO COMMERCIALS.... well, that went away fast... now probably 20 minutes per hour...

SOOO, this could be the start of the slippery slope of fees... kinda like an airline!!!

 

[mebden]

I hate to say this I know we hate talking about crypto but thats exactly what this is trying to get out of all these fees that credit cards charge every merchant that uses them as crypto is working at faster transactions and no fees associated with them will a lot of us older people ever see this probably not but I will bet my son will see a big change with how a0 years

 

[rrs26ja]

More and more restaurants seem to be adding a fee if you use your credit card. I've seen this be upwards of 3%. I know that the CC companies charge a transaction fee, but it just seems wrong to be passing this on to the consumer. I don't like carrying extra cash. And it is much easier to track spending by categories when using a CC. Is anybody using their debit cards instead which usually does not incur the extra fee?

In NYS it is illegal for a restaurant to charge a surcharge. It has to be worded on the menu that the prices on the menu assume a credit charge and it you pay in cash you will get a discount. I just went to a restaurant tonight and it said on the menu there would be a 4.0% charge paid for using a credit card, I called the waitress over and told her it was illegal. I pull it up on my phone and she took a picture of it. The owner was not there. I was charged the 4.0% but because their system auto charges they couldn't fix it. They are going to show this to the owner.

 

[Rustic23]

This perplexed me. There is a restaurant close that offers a cash discount. Another a card upcharge. Now as these are two different restaurants, there is no way to tell which is baking what in. The cash restaurant figures the bill at the credit card price, and offers a cash discount. It makes me feel like it's fare. So I think it depends on how it is presented. Don't quote me a price and charge me a credit fee.

 

[Music Lover]

Please feel my skewer - you penalize the lowest person on the chain who has no control over this policy at the restaurant. Just don't go back.

So instead of a reduced tip the server gets no tip?

 

[Aerides]

So instead of a reduced tip the server gets no tip?

you are trying me... no, i mean just don't go back to that restaurant (after you tip them in full) - they will no doubt fill the seat....

 

[Music Lover]

you are trying me... no, i mean just don't go back to that restaurant (after you tip them in full) - they will no doubt fill the seat....

Lost customers aren't automatically replaced.

 

[marko]

So on a $200 meal, we're talking about $6 bucks here? $3 bucks on $100?

Yeah, I don't think it's right as CCs tend to bring in more spending, but I really have more things on my worry list than if I'm being overcharged $6. If there's no valet ($15 plus tip), you're ahead of the game!

Shortchange a waiter or not go someplace you like over $6 bucks? C'mon, BTD!

 

[NameTaken2]

So on a $200 meal, we're talking about $6 bucks here? $3 bucks on $100?

Yeah, I don't think it's right as CCs tend to bring in more spending, but I really have more things on my worry list than if I'm being overcharged $6. If there's no valet ($15 plus tip), you're ahead of the game!

Shortchange a waiter or not go someplace you like over $6 bucks? C'mon, BTD!

Exactly the mindset these restaurants and other businesses adding fees/etc are targeting.

 

[Music Lover]

Actually, I find "mandatory" 18 percent tips far worse than honest 3% CC service charges.

If it's mandatory, it's not a tip, it's a service charge.

 

[a60dan]

The cost of processing credit card transactions has always been part of the price.

Instead of driving business away by further raising prices, the latest reaction to inflation is to break out the credit card cost and offer a choice to the customer.

When I was in college in the late 1970s, inflation was bad too. NY State at that time prohibited charging extra for using a credit card, thanks to the credit card lobby. Cash discounts were permitted.

Today, it’s now legal to charge extra to use the card.

I’ve seen 3.5-4% here in Western NY.

I’ve started carrying cash again as this is a cost I can control.

 

[marko]

Exactly the mindset these restaurants and other businesses adding fees/etc are targeting.

Sure. Except the only thing stiffing the server and not going back accomplishes is having the server being glad that you won't be back.

 

[GenXguy]

So on a $200 meal, we're talking about $6 bucks here? $3 bucks on $100?

Yeah, I don't think it's right as CCs tend to bring in more spending, but I really have more things on my worry list than if I'm being overcharged $6. If there's no valet ($15 plus tip), you're ahead of the game!

Shortchange a waiter or not go someplace you like over $6 bucks? C'mon, BTD!

I don't think it's a matter of being worried as just being aware and not wanting to be a sucker who gets overcharged with extra and hidden fees tacked on. I've heard some of the payment systems that when you select a certain percentage of tip, it automatically tips MORE than the percentage would equal even if you were tipping the government tax. I always do a set dollar amount for tip.

No way I'm wasting $200 on a meal and never used a valet, so that's just ridiculous. So, that's not even part of the game or calculation. I can keep it under $20 for a single meal at a table service restaurant.

I've read that people are tipping less, and I think these other fees just give them another reason to do so, even if it's misguided. I was a waiter many years back and received a base wage of about $2/hr, and tipping was 10% to 15% on low cost meals. But these days, minimum hourly wage for tipped workers is well above the national minimum wage at nearly $10/hr while tip expectations are 20% to 25% of inflated high cost meals. It doesn't take much in tips to close the gap to the $14/hr state minimum wage. Now they're proposing making the minimum tipped wage the the same as other workers, so the tips are just gravy at that point.

A lot of people are cutting back on eating out with today's prices, so the restaurant doesn't want to lose a paying customer. If they can't stay in business, the server will be out of a job.