Credit card swipe fees: What you need to know - KMSP-TV

Credit card swipe fees: What you need to know

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MINNEAPOLIS (KMSP) -

Next time you go to the store, you may see a sign that tells you that you will be charged a fee if you use a credit card. That fee can be anywhere from 1.5 percent to 4 percent of your purchase.

These checkout fees became a reality Sunday.

This all stems from a settlement last summer following a lawsuit that was filed in 2005 against MasterCard, Visa, and some financial institutions made it possible for merchants to impose a "checkout" fee that would amount to about 2 to 3 percent of purchases charged to a credit card.

This has been an ongoing battle involving banks and major credit card companies including MasterCard and Visa, and on January 27, merchants in the United States and its territories will have the option to add a surcharge to either all credit card transactions they process or to certain types of credit card transactions.

For years, retailers have been complaining about swipe fees, the fact they have to pay money every time their customers use a credit card.

Before the class action settlement, Visa and MasterCard prohibited retailers from adding a surcharge to consumer credit card purchases.

Now, retailers have the option of charging a checkout fee. Large retailers like Target said they will not charge these fees, but for many small businesses this can hurt their bottom line.

More info: http://knowyourcard.org/

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