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Dealers charging a fee for using a credit card

I’m wondering if this is the new trend of dealers charging customers anywhere between 3 and 4% fee on the total sale if paying by credit card?   I was going to buy a brand new item online for 5K, but stopped dead in my tracks when I found I was going to have to pay a 3.9% fee for using my Mastercard!  The fee would have been almost $200.00!   Since this dealer has mostly online sales, it sounds like a big money grab to me. Between the 5K price, add $275.00 for shipping and 200 for paying by CC plus sales tax of $300.00, it would have cost me $5775.00.  I cancelled before I clicked send.  I called the dealer and was told that is the cost of doing business on the internet, so I basically told them to pound sand. 
 

Two weeks ago, I had all new brakes and rotors replaced on my 2020 Tucson with only 22K miles on it.  The bill was $1375 and I paid with my card.  When I got the statement, there was a CC fee of $37.00 added to the bill.  I went back to the Hyundai dealer and was told all businesses do this and he pointed to the sign.  I told them I saw the sign but paid with my DEBIT CARD, not a CC.  I was told it didn’t matter.  When I asked how many transactions were in cash, the service writer told me one out of fifteen pay in cash.  This makes me sick to my stomach.  
 

I would like to hear from others who have dealt with this. 

stereo5
bigtwin's avatar
bigtwin
1,625 posts
 

@stereo5  The problem that many business owners are having with credit cards, is the escalating fees the card companies are charging.  This feeds back to the loyalty rewards everyone has come to expect from their credit card. That 2%+ reward you are earning isn't being paid to you by VISA or MC out of their profits.  They are raising the processing fee to the store owner to cover it.  So if you want 2% back on the purchase, the owner is simply asking to be reimbursed.  There's no free lunch. Now on the issue of the same fee being charged when you pay by Debit card, there you were totally screwed by the dealer.  The normal charge to the business for Debit Card transactions is 6 cents.  

analog_tiffer
67 posts
 

Not unusual at all (anymore).    I worked for a U.S. based audio manufacturer for several years and they did it on stuff they sold direct, like parts, accessories, B-stock and open-box audio gear, etc.    It’s simple economics…ALL costs, regardless of type or source, must be covered SOMEWHERE in the financial chain of custody; more and more companies are passing it through to consumers, which U.S. law provides for.     Then again, we’d also suggest to customers (i.e. over the phone) that they could send us a personal check as an alternative.    Of course, that’d slow their order for a few days while their check cleared, but a surprising number of people did exactly that…mailed us a check.   Kinda crazy.  

qjm101
122 posts
 
parkergetdean
one way of hiding tariffs

 

 

Is this supposed to make sense?

mulveling's avatar
mulveling
2,449 posts
 

If they’re charging MSRP or near it (e.g. some piddly discount < 10%), then they have ample margin to cover payment processing fees. But if you’re getting actually good discounts from a long-time dealer, then yes I could see that being an issue. I always paid cash/check to my longtime dealer before he retired. I also know a young dealer in Maryland (very young by this industry’s standards) who gives nice deals and also eats CC fees. He’s a great dealer too. 

I don’t understand all the big online audio retailers that charge MSRP to ship your gear. They all suck. Terrible salespeople. They’ve all dropped the ball on me at one point or the other even when my entire interaction was basically: here is my money, take it. 

19johnnyvegas59
4 posts
 

Last time I was running business- when we signed the CC agreement- back then you had to agree NOT to up charge the fee to consumer. 

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