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Comment by woodruffw | Hacker News Reader

> I love that every tiny operation accepts credit cards and apple pay now.

At least in NYC, it's standard for street vendors and smaller businesses (like delis) to take only cash (or to have a purchase minimum for a credit charge, usually $10 or higher).

I've heard lots of reasons for this, all of which I find plausible: it's more profitable (credit processing fees are effectively a regressive tax), it allows vendors to pass on savings to their customers (my local coffee shop gives me a discount if I pay in cash), and it allows them to dodge their local sales tax.

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whenever you want you can always throw the credit card merchant agreement at any of those vendors just because you feel mildly inconvenienced.

it is against the merchant agreement to have any purchase minimum and vendors have absolutely no leverage on this reality (as this is per payment network, this can change per network at any time, but my understanding is that merchants can't have card minimums - this also applies to bars where much higher card purchase minimums are also commonplace)

of course, the sympathetic approach is to realize that its more profitable for the credit card network to have no mininum. but as you don't really experience this concept of card minimums outside of NYC, there's no reason to follow along with those merchant's rationale just because they told you why and you feel sowwy for them.

when I think about every thing that threatens low margin businesses, I just notice that a different one will take their place and a few owners will have to do something else to exchange time for food and shelter just like everyone else, so no need to keep them on life support

> whenever you want you can always throw the credit card merchant agreement at any of those vendors just because you feel mildly inconvenienced.

This is a recurring misconception: merchants have been allowed to set a credit card minimum of up to $10 since Dodd-Frank[1]. Even before that, entire industries have had merchant exemptions (utility and rent collection come to mind).

The rest of this response is bizarrely cynical: I don’t feel “sowwy” for them; I like saving money on my coffee and I’m happy knowing that my payment method is more sustainable, since it means I don’t have to worry about changing my routine.

[1]: http://www.ftc.gov/business-guidance/resources/new-rules-ele...

Thanks Thats very helpful!

Yes very cynical

You left out the reason there is a minimum - there is a cost to run the card that is fee(purchase) = A * purchase + B. The minimum is to ensure that B doesn't dig too much into their profit margins (which is also a percent).

And while they may think it's worthwhile to sell you a fountain drink for $1 on the card, it's too complex to break it up like that.

> You left out the reason there is a minimum - there is a cost to run the card that is fee(purchase) = A * purchase + B. The minimum is to ensure that B doesn't dig too much into their profit margins (which is also a percent).

The reason there's a minimum is that the Federal government forbade credit card companies from mandating acceptance for all charges. That was done in the consumers' interests, but it came from the top down, not the beneficence of Mastercard and Visa (who, prior, were more than happy to take 2-3c on every $1 card purchase.)

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