Plastic Chokes Your Favorite Local Businesses

March 29, 2010 at 1:00pm By: Mr. Wilson Posted in The Lincolnite Blog

It’s awfully easy to get lazy and use a credit card or debit card wherever you go. But if you love local businesses—and I know you do—then spare them some fees and use cash instead. I try to always keep cash in my wallet so I can do just that, though I’m not always successful. The coins I collect wind up in my son’s piggy bank. Instant allowance and savings account!

A few local businesses don’t accept credit/debit cards because of the high fees. The Cookie Company in Gateway is one; Ivanna Cone in the Haymarket is another. I’m sure there are others out there.

For the record, businesses are not permitted to require a minimum purchase amount before you can pay with plastic. Their agreement with the credit card companies forbids such a policy. You can see how that puts businesses in a bind with small purchases: violate their contract or lose money on certain sales. When you pay cash you avoid all that unpleasantness.

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The Comments

Fletch March 29, 2010 at 1:59pm

Or, they could simply raise prices by a mere 5 percent and more than cover the fees.

I try to use cash for any purchases for under $7 or 8, but usually for more than that, it’s just easier and faster to swipe the debit card. Plus, my card earns points that I can use to further reward myself.

I apologize in advance to anyone that chooses to rob me, and walks away with about $12 or so.

JT March 29, 2010 at 2:42pm

It seems really unfair that we can’t have a minimum on card swipes. Maybe something we could legislate.

Nikkidemas March 29, 2010 at 2:54pm

That’s part 2 of the 10/11 story.  It airs tonight.

Fletch March 29, 2010 at 2:54pm

This wouldn’t bother me at all. Or, even a service charge - from the merchant - for card swipes that are under a certain dollar amount. That would allow them to recoup their costs.

Mr. Wilson March 29, 2010 at 3:01pm

“Or, even a service charge - from the merchant - for card swipes that are under a certain dollar amount.”

Not legal per the merchant agreement.

Cotton March 29, 2010 at 4:13pm

Or merchants could offer a small discount for paying in cash

Moses March 29, 2010 at 4:47pm

I prefer to stay off the grid as much as possible and pay cash.  The fewer times you put your personal info out there the better.

Big Brother March 29, 2010 at 4:53pm

Ha! Silly civilian. You think I don’t know who you are and where you spend your money? I know everything about you. EVERYTHING! Mwa ha ha haaaaa!

Nikkidemas March 29, 2010 at 5:37pm

I’m one of the people who never pays cash.  My debit card is pretty worn out!  But I will definitely keep this in mind now as I’m shopping & eating at local places.  Also, I will make sure to pay with plastic if I’m ever at Wal-Mart.  Just doing my part wink

Fletch March 29, 2010 at 6:01pm

I get that it’s not legal - I’d be in favor of a change in the merchant agreement for a reasonable minimum purchase.

foxspit March 29, 2010 at 6:13pm

I almost always choose a local business over a franchise and I completely understand what Mr. Wilson is advocating.

Realistically, though, I’m probably not going to start carrying cash. Using my debit card is just too easy. I regret that it adds to the cost of business, but the debit card so appeals to my inner sloth that I know it’s a habit I’m not likely to break.

But I appreciate that Mr. Wilson has put this little seed in my brain. It’s something I’ll be thinking about.

Stacy March 29, 2010 at 6:38pm

How about we lobby to get the fees reduced for businesses instead? 

Reality, we are quickly becoming a paperless society.  I can’t tell you the last time I had cash.. no I take that back, it was 2 weeks ago when I took money out to convert to quarters for parking meters so I wouldn’t get anymore parking tickets (I think parking meters should take debit cards!).  We pay everything either online or with our debit card.  We write maybe 2 checks a month, if that often.

I run an online business that filters all payments through PayPal.  The fees are astronomical, but it’s a price of business that I write off each year on my taxes.  If we really want to support the stores, and not try to go against a tide that is stronger than us (paperless) lets work towards getting the fees decreased for the businesses.

Moses March 29, 2010 at 6:45pm

With PayPal do you get some sort of insurance that the money is good before you ship your product?  Sort of like a credit default swap? 

The only way to get the fees reduced is to quit using the service.  The market will respond quickly.

Stacy March 29, 2010 at 7:23pm

For what I sell, no, there is no insurance. 

And yes, quit using the service is a quick way to get the fees reduced, but it’s not practical or even logical, in this day and age.  So we need to work within the understanding that credit cards and debit cards are not going to magically stop being used/accepted, but if we put enough pressure to get laws changed to lower those fees, then that can work.  Look at the new laws that were just passed in regards to credit card companies and banks with their overcharge protection.

Scott T March 29, 2010 at 10:18pm

Please don’t confuse a franchise with a Corporate owned business.  Most franchises are locally owned and have to worry about these fees just like an independent business.  Sure there are the Applebee’s, Red Robins and Chili’s of the world that are owned by large investment groups but they take North of $2,000,000 to open a single location. 

My small business is a franchise that has 2.5 employees including myself. You probably deal with a lot more small franchisees that you even realize.

Fletch March 29, 2010 at 10:20pm

As to dealing with franchises - in many, many cases, when you are doing business with a franchise, you are still helping the local little guy. Some of his/her profits ultimately go back to the home office, but it’s very possible it’s someone from hometown Lincoln, NE that’s put their own time and savings on the line. No sense to think ill of these fine folks, or lump them in with Walmart, if you’re prone to hate those types of folks.

Fletch March 29, 2010 at 10:22pm

My comment was supposed to be in reply to the franchise comment. I don’t know why so many of my replies don’t go where they should.

Mr. T March 29, 2010 at 10:46pm

Agree with Fletch. I use my credit card as much as possible for those cash back points.

I can see how its perceived as a racket from the perspective of the stores (and for the consumer as well), but that’s the cost of doing business.

Having said that, I’ll try and be more cognizant of trying to use cash at local favorites from now on.

Martyytram March 30, 2010 at 1:35am

Ernie’s gas station at 40th & A charges less for cash/check than credit card.

Scott T March 30, 2010 at 3:19am

Thanks Fletch.

Certainly my “profits” do not go back to a home office.  That is overhead I pay for being associated with a well-respected franchise and to pay into their National Advertising Fund.  My Profits are all spent locally in Lincoln.

Thanks Lincoln for supporting your locally owned businesses of all sorts.

Fletch March 30, 2010 at 4:17am

I was trying to break it down for people that may not get it. I understand franchising pretty well. I hate seeing them lumped in with the chains that people love to hate.

I should have said a portion of the revenues may go to the home office, but it’s still usually the local guy/lady trying to make it fly, and it’s still very much supporting a local entity.

CS March 30, 2010 at 1:37pm

With paypal the account has to be tied to a bank acct or credit/debit card to send payments, or the Paypal acct. itself has to have money in it. Your payments come from either the money already in there, or a combination of that money and the balance from whatever acct. you have tied to it. There short of paying, and then filing a bogus complaint to PP about the item purchased there isn’t really a way to have the money be ‘bogus’. I have a specific acct. tied to my PP account with no money in it unless I want there to be, and I pull all my received payments out of PP as soon as I have processed shipping for the item(s).

Stacy March 30, 2010 at 3:52pm

Yes and no.

Example.  I had a purchase last month and withing 30 minutes of the money being taken from the customer’s PayPal account, PayPal froze the funds in my account due to possible fraudulent actions on the buyers behalf.  Yes, there may be funds attached to the account, but that doesn’t always mean that the seller will receive them.  In that case, PayPal found that there were fraudulent activities and we lost that money.  This happens on a regular basis, and because of what I sell to customers, I have 0 protection as the seller.  And though bogus chargebacks are not often, they do happen, and again, because of what I sell, I have no way protection under the terms of use of PayPal.

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