Credit Card Usage Fees - Action Line

Dear Action Line, I was on a trip recently and wanted to make a purchase with my credit card. However, the store had a sign that said I needed to make a minimum purchase of $10 in order to use my credit card. I only use my cards when I travel but I have seen these signs before. Can merchants require a minimum purchase for credit card transactions? Why do they charge me a fee just to spend money with them? And why is it that I am charged a higher price for using my credit card at gas stations?
March 06, 2017

Dear Reader,

According to the agreements merchants sign with MasterCard and Visa, merchants are not allowed to place minimum amounts on using a credit card for purchases. Discover keeps its agreements private. American Express says its merchants cannot do anything to discriminate against card users so, in essence, merchants can’t require a minimum purchase with AMEX.

Also, according to their service contracts, merchants are not supposed to charge a plain usage fee for using credit cards. Personally, I find this most often at small independent stores (like Mom & Pop stores) and my guess is they do that to cover their transaction costs. Restrictions about charging fees for using a debit card would vary by whatever agreements the merchants had with their bank.

What can you do if a minimum amount is set or an extra fee is charged? The consumer has the right to inform the merchant that their policy is incorrect; refuse to shop at that merchant and/or call the number on the back of their card and report the merchant.

However, merchants can charge a fee when it is a convenience fee. For example, you are paying your telephone or utility bill at the liquor store or sandwich shop, a service that the store offers, but that is a business/service outside of that store’s routine practices.

As for using credit cards at gas stations, most stations do charge one price for using your credit card and reward you with a lower price for using your debit card or paying with actual cash. There is nothing in the credit card service agreements prohibiting offering discounts for using cash while charging another price for using the credit card.


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