Credit Card minimum PURCHASE amounts

[Robert Maxwell]

Debit cards (such as VISA Checkcards) are processed as ACH transactions which are cheaper than credit transactions. The interchange rates are also lower. So, there are still fees but they aren't nearly as onerous as the merchant fees on credit transactions.

 

[PsychoPere]

On the back of my credit card, in the field for the signature, I've written in block letters "ASK FOR PHOTO ID." As one way to avoid identity thief I want them to ask.

Any business would then be within their rights to refuse to accept your credit transaction. "Ask for photo ID," "see ID," etc. are not valid signatures. The signature line is not merely for verification of signature, but more importantly to indicate that you have indeed accepted the terms of your contract with the credit card company.

 

[Jan]

I do the same (or I process it as a debit, which doesn't cost the store anything).

That may be true for some businesses but I know for sure that it was not the case at the hotel I worked at. Every debit or credit transaction incurred both a percentage 'discount'to the bank and a per-transaction fee.

Jan

 

[cultcross]

Interesting. So Mom and Pop's diner (or in your case pub) might impose a minimum because they have to make their margin, but a franchisee (McDonalds, for example) whose margins are much smaller (percentage wise) would be able to absorb that cost?

Exactly. I can go into the supermarket and buy a stick of gum with my card (Visa debit, I don't have a credit card, horrible things) but the newsagent next door will only take cards over £5. Tesco can absorb the cost in favour of maintaining a loyal customer (and it wouldn't surprise me if they negotiate sweetheart deals with the card companies - £1 in every £7 spent on the British high street goes to Tesco, that's negotiating power to dream of), but Malik's Newsagent can't afford to do that.

 

[knine]

About 3 years ago the university I was attending stopped accepting credit cards (online and in person) as payment for anything that would go with tuition. I guess they were getting hit hard with fees. While I was under a stipend for tuition, I still had to pay for student health insurance through this "department" or whatever you want to call it. I would always save during the previous semester for the bill, then charge it online, then just pay it off with a simple transfer with my credit union online. This change in policy forced me to have to take an hour each semester to go give them cash or a check at the window in the administration building. It was annoying, but I can see why they starting doing it with how much they were losing in fees.

 

[Lindley]

(I don't have a credit card, horrible things)

Well, that was my view up until now. However, it turns out that not having a credit card means you don't have much of a credit history. Which means no one will give you a loan, a mortgage, or even a rental car. It's a problem.

I figured I'd get a single credit card and use it a bit to build up my credit history.....but they wouldn't approve me for the Amazon card. Due to lack of credit history.

So now I'm pondering the best way out of this catch-22. My advice: find some way to establish a meaningful credit history. Never know when you'll need it.

 

[Amaris]

It's common here in Ohio, too. There was a little store down the street from where I live now that would accept credit cards, but the minimum purchase was $5.00. One night the owner was running the register and I asked her what she had to pay per transaction on credit card purchases, and she said she had to pay $7.50 per transaction. The only reason the minimum was $5.00 and not $7.50 was because, according to her, they didn't want to seriously inconvenience the customer.

 

[Timby]

So now I'm pondering the best way out of this catch-22. My advice: find some way to establish a meaningful credit history. Never know when you'll need it.

Go to your bank and ask for a credit card. My wife, who also had no credit history, did this when she opened her checking account earlier this year. The bank got her a Citibank card, to which she charges no more than $100 / month and pays off quickly.

(and it wouldn't surprise me if they negotiate sweetheart deals with the card companies

At least on my side of the pond, it's not about sweetheart deals, it's all about transaction volume. A grocery store / supermarket will process hundreds, if not thousands, of card transactions per day. Those places are afforded a much smaller per-transaction fee by the banks (depending on the card), generally in the neighborhood of 1 - 2 percent. A smaller grocery, like a mom-and-pop grocer in a small town, will often pay as much as 5 - 6 percent per transaction.

There's a reason that American Express and Discover cards aren't accepted everywhere, too. AmEx's floor for transaction fees is 7 percent. That's for merchants who process the cards all day, every day. Fuck that noise.

 

[darkwing_duck1]

You actually took a RFID chip?

I'm not following.

Maybe it's a "slanguage" problem. In the US, saying you used the "chip" would imply that you had one a Radio Frequency IDentification chip implanted. In the US, they're used on pets and are starting to be used in some food animals for tracking purposes.(thankfully not in widespread use, in fact, I didn't think they'd even been APPROVED for human use)

I'm guessing now you mean a so-called "smart card" with a memory chip in it that holds all your credit data?

Well, that was my view up until now. However, it turns out that not having a credit card means you don't have much of a credit history. Which means no one will give you a loan, a mortgage, or even a rental car. It's a problem.

Increasingly, it's even costing people JOBS. Employers have been known to screen job applicants' credit histories, supposedly as indicators of their general trustworthiness.

I don't think anyone has been actively FIRED yet for bad credit history, but it wouldn't surprise me if it started happening.

Having a frakked up credit history can also keep you from getting (or keeping) a security clearance and/or financial clearance for jobs that involve cash handling (like bank tellers, etc).

I figured I'd get a single credit card and use it a bit to build up my credit history.....but they wouldn't approve me for the Amazon card. Due to lack of credit history.

So now I'm pondering the best way out of this catch-22. My advice: find some way to establish a meaningful credit history. Never know when you'll need it.

Every "repair your history" article I've ever seen pretty much says the same thing. Get a "secured" credit card (one backed by a bank deposit) with a major reputable credit card company. Use it and make damn sure you keep up the payments (no "lates", etc). After about a year, you should build up enough of a record that you should start getting credit card offers.

Oh, and make sure you don't "short" ANY other bill (phone, rent, utilities, etc), as inceasingly THOSE go on your credit record too.

Prior to the CARD act, shorting those bills could trigger "universal default" and jack your card interest rates and do other nasty things to your credit rating

 

[Mr. Laser Beam]

You actually took a RFID chip?

I'm not following.

Maybe it's a "slanguage" problem. In the US, saying you used the "chip" would imply that you had one a Radio Frequency IDentification chip implanted. In the US, they're used on pets and are starting to be used in some food animals for tracking purposes.(thankfully not in widespread use, in fact, I didn't think they'd even been APPROVED for human use)

I'm guessing now you mean a so-called "smart card" with a memory chip in it that holds all your credit data?

No, I didn't. I know what those are, but I wasn't talking about that. I only meant a 'regular' ATM card that was not in any way, shape or form a credit card.

 

[darkwing_duck1]

About 3 years ago the university I was attending stopped accepting credit cards (online and in person) as payment for anything that would go with tuition. I guess they were getting hit hard with fees. While I was under a stipend for tuition, I still had to pay for student health insurance through this "department" or whatever you want to call it. I would always save during the previous semester for the bill, then charge it online, then just pay it off with a simple transfer with my credit union online. This change in policy forced me to have to take an hour each semester to go give them cash or a check at the window in the administration building. It was annoying, but I can see why they starting doing it with how much they were losing in fees.

Which is odd, since banks have been quietly pressuring people away from paper checks for some time now. They don't like messing with them and they're more expensive to process than credit transactions.

 

[Lindley]

So now I'm pondering the best way out of this catch-22. My advice: find some way to establish a meaningful credit history. Never know when you'll need it.

Go to your bank and ask for a credit card. My wife, who also had no credit history, did this when she opened her checking account earlier this year. The bank got her a Citibank card, to which she charges no more than $100 / month and pays off quickly.

Well, my only criteria is that I will not get a card with an annual fee. A "secured" card is certainly an option, but I'm going to check with my bank and see if I can get one of their cards without a fee first.

 

[cultcross]

(I don't have a credit card, horrible things)

Well, that was my view up until now. However, it turns out that not having a credit card means you don't have much of a credit history. Which means no one will give you a loan, a mortgage, or even a rental car. It's a problem.

I figured I'd get a single credit card and use it a bit to build up my credit history.....but they wouldn't approve me for the Amazon card. Due to lack of credit history.

So now I'm pondering the best way out of this catch-22. My advice: find some way to establish a meaningful credit history. Never know when you'll need it.

Well, I did have a Barclaycard for a few years when I travelled the US - American businesses were really shitty about debit cards issued by British banks, even Visa ones, so I had a credit card for US purchases. I got rid of it a couple of years ago though as I wasn't using it. Although I wasn't even working when I took that card out, they gave me a three grand limit.

I don't think it's too much of a worry though - a friend of mine at work just got offered a £250,000 mortgage on her £25k salary with no loan history at all bar a student loan (which they don't count here). She just sat there and gave them a "have you learnt nothing?" look.

 

[Terengo]

Well, that adds an interesting wrinkle to a dilemma I was having. At my work, a public library, we've wanted to offer credit/debit cards for a long time, but the cost per transaction was just too prohibitive. We have the occasional large fee for a lost book or the like, but most fees we receive each day are for printouts and photocopies, typically under 50 cents. We'd lose money on most transactions. We were told by the banks we talked to that it's actually against the contract to put a limit on card use (as someone noted, they want their transaction fees, whether it helps or hurts the merchant). It suddenly becomes much more doable, if we could legally limit card use to $5.00 or more.

 

[darkwing_duck1]

No, I didn't. I know what those are, but I wasn't talking about that. I only meant a 'regular' ATM card that was not in any way, shape or form a credit card.

Got it...Churchill was right. The US and UK really ARE divided by a common language!

 

[Guartho]

I've solved almost all of this for myself by no longer using my credit cards. I am, of course, still effected by society-wide effects like higher prices to make up for fees, etc.

 

[cultcross]

Got it...Churchill was right. The US and UK really ARE divided by a common language!

Chip and PIN is the standard payment method using cards these days in the UK - it replaced signatures about 4-5 years ago, and it's been pretty successful. It works around 'smart cards' which hold account info on a chip - the checkout will have a machine where you insert your card and enter your PIN on a keypad. The point of the whole exercise is twofold: a signature is a subjective thing, and how many checkout workers actually ever tell anyone their signatures don't match? A PIN is right or wrong. Secondly, its a pain to 'change' your signature - you can change your PIN in about 30 seconds at any ATM.

 

[Pingfah]

No, I didn't. I know what those are, but I wasn't talking about that. I only meant a 'regular' ATM card that was not in any way, shape or form a credit card.

Got it...Churchill was right. The US and UK really ARE divided by a common language!

He's American.

 

[Lindley]

Got it...Churchill was right. The US and UK really ARE divided by a common language!

Chip and PIN is the standard payment method using cards these days in the UK - it replaced signatures about 4-5 years ago, and it's been pretty successful. It works around 'smart cards' which hold account info on a chip - the checkout will have a machine where you insert your card and enter your PIN on a keypad. The point of the whole exercise is twofold: a signature is a subjective thing, and how many checkout workers actually ever tell anyone their signatures don't match? A PIN is right or wrong. Secondly, its a pain to 'change' your signature - you can change your PIN in about 30 seconds at any ATM.

Well, when you charge a bank account-linked card in debit mode, you need to use a PIN. That doesn't apply when you hit the credit button, though.

 

[Gepard]

[
So now I'm pondering the best way out of this catch-22. My advice: find some way to establish a meaningful credit history. Never know when you'll need it.

Can you get yourself added as a user on a relative's credit card? I started out with really good credit history because I was authorized on my parents' credit cards as a teen; I almost never used it, but just being associated with people paying their balance on time apparently carried over.