posted on Dec, 23 2011 @ 05:46 PM
Heres how it works:
As a online supplier, you get a merchant fee on credit charge, and not on a debit charge, a consumer should never have to pay a debit charge.
The merchant fee is passed on as these are generally large ticket items with minimal mark up from a wholesale purchase.
What the 'agent' does is get it at a cheaper rate for the consumer by bulk buying, its chepaer than you would get from a airline or hotel direct. If
the item is say 2000 dollars nett, the agent generally puts a $25.00 - $50.00 booking fee, thats is the profit off what you buy, however the credit
card companies charge the agent/merchant between 1.9%-4.1 % depending on is its amex or visa etc. That would put the selling agent who is getting the
cheaper bulk purchased ticket for you into the red, thats why the merchant fee is passed on.
So either you pay the merchant fee on credit or prepare for items to get a bigger markup to cover the merhcant fee at sale time.
If they were to remove the credit fee by law, it would actually force the consumers to pay more by markups going from 25-50 dollars per purchase to
about 250 mark up, in the end the current system allows you to purchase for cheaper if you pay cash or on debit.
And what most of you dont know is the airlines have a 'surcharge tax' since the 70s that is a merchant fee, so its nothing new, simply a cost that
needs to be covered so one can use a credit facility.
I wouldnt bark too loudly unless one wants to see prices increase
edit on 23-12-2011 by zazzafrazz because: (no reason given)