23 replies to this topic

[OEXCHAOS]

... If anything, it seems to me that there are more incentives than ever, such as cash back, miles, etc. offered by the CC companies. How do they spread their losses, other than to those who pay the outrageous finance charges?

Aren't those incentives paid for by the merchant who accepts the card? I think the fee the merchant pays is higher for incentive cards than for regular cards.

The CC companies usually screw the merchants. They make everything easy, even on irresponsible consumers, encouraging use of the cards, then merchants find them ubiquitous and MUST take them, then when there's a problem, the card companies bag the merchant, who then raises the cost of the goods.

You'd be shocked at how much the card companies take out of each purchase.

Mark

[ed rader]

That's the sad fact. They spread their losses across ALL of us.

How's that? If you mean the outrageous finance charges, there's no excuse for not avoiding those - simply pay the balance off every month. Other than that, how do they spread their losses amongst all of us? The merchant fees, which I guess you could argue are passed on to the consumer, haven't changed since credit cards were introduced even though the number of fraudulent charges seems to be increasing. If anything, it seems to me that there are more incentives than ever, such as cash back, miles, etc. offered by the CC companies. How do they spread their losses, other than to those who pay the outrageous finance charges?

i pay my card off every month plus get air miles...i have more than 200k air miles accrued and every time i try to use them i can't .... that's how they get you !

ed rader

why cant u use them?

my wife is a teacher so vacation is tied to her schedule, which are the times that everyone else travels. i can use the miles but it's been difficult....much harder than it was a few years ago.

ed rader

... If anything, it seems to me that there are more incentives than ever, such as cash back, miles, etc. offered by the CC companies. How do they spread their losses, other than to those who pay the outrageous finance charges?

Aren't those incentives paid for by the merchant who accepts the card? I think the fee the merchant pays is higher for incentive cards than for regular cards.

The CC companies usually screw the merchants. They make everything easy, even on irresponsible consumers, encouraging use of the cards, then merchants find them ubiquitous and MUST take them, then when there's a problem, the card companies bag the merchant, who then raises the cost of the goods.

You'd be shocked at how much the card companies take out of each purchase.

Mark

there's two sides to that coin, Mark. credits cards promote impulse buying and spending money that you don't have which benefits retailers.

most shoppers won't bounce a check to buy a pair of shoes but they will charge them even tho they don't have the cash to back the purchase.

stores aren't forced to accept credit cards they do so because it makes them money.

ed rader

Edited by ed rader, 26 September 2007 - 10:16 AM.

[mss]

stores aren't forced to accept credit cards they do so because it makes them money.

ed rader

That is sort of a glass "half full - half empty" statement.

True stores are not forced to sccept credit cards, but if they dont, they don't have many sales. Accepting credit cards only makes them money if goods are priced correctly.
The charge back on CC was/is 3-7% depending on volume of sales and now charge backs are also going back to the seller.
Saddly not accepting CC in todays world would be like not accepting cash when I was growing up.


BTW: just another way of saying the same thing Mark said at the top.

Edited by mss, 26 September 2007 - 11:57 AM.

[ed rader]

stores aren't forced to accept credit cards they do so because it makes them money.

ed rader

That is sort of a glass "half full - half empty" statement.

True stores are not forced to sccept credit cards, but if they dont, they don't have many sales. Accepting credit cards only makes them money if goods are priced correctly.
The charge back on CC was/is 3-7% depending on volume of sales and now charge backs are also going back to the seller.
Saddly not accepting CC in todays world would be like not accepting cash when I was growing up.


BTW: just another way of saying the same thing Mark said at the top.

you can't deficit spend if you are dealing in cash. you either have the money or you don't...or you have a credit card. the retailers are whining all the way to the bank.

ed rader