01 Jul Will Extra Fees Discourage Credit Card Use?
We all know that we pay more for purchases made with a credit card, right? Sure, there is the outrageous interest that the credit card companies charge for the convenience of plastic over cash. But what if a growing trend of discounts for cash catches on nationwide and credit card purchases become even more expensive as a result?
That is the trend in some states. Connecticut recently passed a bill allowing gas stations to give a discount for cash purchases. That means then when you pay with a credit card, no only are you going to pay interest on that purchase, but you are paying more than a cash customer right from the beginning.
Other states also allow discounts for cash. A merchant can’t charge more than the regular price for a credit purchase, but he can charge less than the regular price for a cash purchase. (Even the lawyer in me can’t see that difference!)
Could the economy shrink even further if we wean ourselves from the addiction of credit and start paying for everything in cash?