Wednesday, July 25, 2007

Update on Interchange fees

Here's an update on the controversial interchange fees, something that I wrote about before.

They say that these fees are a concealed burden on customers because the inflate the price of retail products for all customers.

I have a very simple solution to the whole thing: allow merchants to pass the fee directly to their customers. Make sure they do not charge more than the interchange fee, but just bring it out into the open. Now it no longer burdens those who pay in cash and it opens up competition (because what consumer is going to use Amex that charges them 4% of the transaction when they can use VISA that charges 2%?). Problem solved.

1 comment:

Aneace Haddad said...

Good point. Check out my blog post from yesterday, exactly on that subject. I am convinced that retailers will end up being able to surcharge credit card purchases. It just makes sense.