New law allows 4% credit card surcharge - WREX.com – Rockford’s News Leader

New law allows 4% credit card surcharge

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Depending on how you pay for items, you can now be asked to pay more. The new law allows businesses to add up to an additional 4% to your total every time you use a credit card.

Karen Elyea owns Minglewood,  a boutique just east of the rock river on state street. Most of the purchases in her shop are made with a credit card. "It's predominantly debit and credit card, there's hardly any cash anymore," she says.  

And she is charged for each one of those transactions. "It's upwards of 3% generally for me."

Cheryl Sio, President of the Members Alliance Credit Union explains, "Card issuers make money every time somebody, a consumer, uses their credit card."

It's called as merchant surcharging, and it's now legal in 40 states, including Illinois. It is however, optional.  

"I can see a business owner choosing not to, cause it's, in a way it's going to be negative PR for awhile," says Sio. "After awhile people won't even think twice about it. It's like paying ATM surcharge fees, when they first came out, it was a big deal, now nobody even thinks twice about it."

Elyea says she has no plans to adopt the law.  "Those costs I just associate them with fixed overhead costs. and it's already worked in to how things are priced. So I wouldn't plan to start to charge customers more because of that. If I was I would lower all the prices."

Stores that do pick up the credit card fee will be required to post a sign on their front door to inform customers.

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