50p charge if you spend less than £10 on a card?

[JoySzasz]

Our local village petrol station/shop does this. Not always, but always when the miserable boss is around.
I spend a fair bit in there, as l imagine most of us locals do.
I might have imagined it, but l thought l heard retailers were not supposed to do it?
They are still claiming (according to my brother) that the bank charges them.
Are they being unreasonable?

Small retailers often have to wait anything up to a fortnight for the card company to transfer the money into their bank account. They pay higher transaction fees too.

I work in a shop that has a £5 minimum spend on card purchases. This was brought in because we had customers who wanted to buy a (already discounted) pot of tea for £1 and use their card. We would lose money.

We have been told that legally businesses are not allowed to charge extra for low value transactions

Thought I might drop in that I asked about my local newsagents £1.50 card change. Their reply was "how about a kiss instead?"

But there is a world of difference between charging extra, and refusing transactions below £x.

Has anyone found relevant legislation that says what is not permitted?

Yes, banks charge them. I never pay with a card in charity shops as they make less money if I do. I don't much care about supermarkets, I paid £1.72 by card today as I hadn't been to the bank.

As my transactions are always in the 6-8 pound bracket, surely they still make money even if l use my card?
Sometimes l spend much more, obviously the charge isn't applied - but as l am a very regular customer l'd expect them to waiver it. like they do when miss misery isn't there
I don't know why this had got me thinking?

Fanjo
We have been told that legally businesses are not allowed to charge extra for low value transactions
I very much doubt it - after the Sainsburys case

Fuzzy
I pay for pretty much all small transactions with contactless now and rarely encounter anywhere without one...
Contactless cards have exactly the same fee structure as all other cards

1-2% fee for debit cards
3-5% fee for credit cards
4-7% fee for Amex

and remember that business ses pay charges every time they pay cash in to their accounts
and every time they pay in a cheque
or write a cheque
or make a faster payment

small business baking is horrendously expensive for small businesses

Went to a pub that did this. They charged you £10 on your card and gave you the change in cash. Neat work around I reckon
( so a purchase of £1 would be charged at £10 and you'd get£9 back)

Our business gets charged 45p per transaction for a debit card transaction (it's a fixed fee whereas credit cards are charged a percentage of the transaction value). If you spend £6 in the shop, 45p works out at 7.5% of the transaction. It doesn't sound like a lot but the mark-up on corner shop type foods isn't great. If they don't pass on the card fees, they'd hardly make anything on your purchase.
So they're not being unreasonable. Bigger supermarkets don't need to charge the customers for card fees as a) they get much better discounts on the food than smaller shops and b) they get better rates from the card merchant services.

Oh dear... I feel a bit bad now. I rarely carry cash any more and have just got into the habit of tapping my contactless wherever I go even for just a couple of pounds.

You doubt it? We were told that.

We were told that.
Who by, evidence ....

We have a vending machine at work which takes contact less. How does that make money then, you can't spend more than a quid at a time

My local shop has a sign on the chip and machine saying they get charged and for small purchases they need to add a charge to cover it.

The charge credit card companies will only be allowed to charge 0.3% of the transaction, this starts on 9th December so hopefully those businesses charging above that will stop/reduce the fee.
I think it's changing for debit cards too but can't remember exactly what that's changing to.

munchkin
We have a vending machine at work which takes contact less. How does that make money then, you can't spend more than a quid at a time
Because there is a MASSIVE mark up profit margin on the contents
a 40p can is sold for 95p
and the owner of the vending machine pools all of the card fees

NCIS
but the monthly rental for the card machines may rocket
and we would not have that reduction if we were not in the EU

It's a fiver in newsagents around here. I think the tenner baseline isn't average as wherever I've lived it's been a fiver in small shops!

Credit card companies charge 3-5% of all transaction values

It's less than that: our rates see large transactions attracting about 1.3%.

When I've done cost comparisons (our clients are generally small companies, turnover generally under £2m, credit card transactions maybe 10% of that) the costs average about 3% or just over.

Contactless cards have exactly the same fee structure as all other cards

Not always true: the interchange fees are sometimes slightly lower for contactless.

Credit card charges are made up of three bits:

Interchange (what VISA/MC charge for the transaction)

• this is a % of the transaction for credit card, and a flat amount for debit

Scheme fees (not sure where these go, probably VISA/MC again)

• a % of the transaction plus a flat amount for both debit and credit, however the flat amount is usually lower on debit, and the total possible is sometimes capped on debit

Merchant fees

• what the credit card company charges for the transaction - on our deal it's a flat amount per transaction

The interchange and scheme fees may vary depending on the type of card (business or personal credit card), the type of transaction (face to face (and whether signature, chip and pin or contactless), mail order/telephone order, E-Commerce (secure, non-secure, CVV2 code).

munchkinmaster
We have a vending machine at work which takes contact less. How does that make money then, you can't spend more than a quid at a time

On our rates, a 95p transaction would cost a bit over 8p for contactless.

WMittens
But when I am doing clients' accounts, the Streamline monthly bills are always horrible no matter which card the customer uses

So many people do not realise that the card companies make their billions by charging small businesses through the nose

Accepting card payments used to cost our small business about £60 a month in charges, and we had quite a small volume as we're not a shop. We stopped accepting cards and went over to cash/internet payments instead.

Our local cafe charges 50p per transaction under £5.

Of course, the same accountant talked me into cancelling the Sage helpline too which was £60 a month. Now weird things are happening....