People go back and forth all the time about whether or not credit cards are good or bad (or “evil” even). Well, not to sound mean, but I don’t really care. I see how its not a one-size-fits-all issue, and once you get to the point you understand that, there’re not much you can argue. If you’ve read about my struggles of holding onto cash and my elaborate weekly budget schemes then you’ll know I use credit cards. A lot.

Anyway, this isn’t about that.

Once upon a time I had a small business. Once upon a time I received different forms of payment from customers….checks, cash, money orders (no one ever really paid that way though), and yes, credit cards. I loved getting payments, but can you guess which form of payment I always hoped I wouldn’t get?

CREDIT CARDS.

You see, credit card companies don’t make money off of the interest they charge me. If that was the only way they made money they either wouldn’t make a dime or they’d have cancelled all of my cards long ago. No, they make their money from the transaction fees they charge the merchants that accept my credit card. (Which is probably why they love me. I use those cards for EVERYTHING.) I was once one of those merchants and I didn’t like them taking my rightfully earned money.

Whenever someone wanted to pay me with a credit card I had to pay a fee. Not huge, something like 3% for Visa, MC, Discover, and something like 3.75% for Amex*. Oh yeah, and I didn’t accept Amex….I would’ve had to upgrade my account and then they’d charge me that higher charge for every transaction I accepted. Whenever possible I encouraged customers to pay me with cash or a check.

That brings me to a revelation….

I’m a total hypocrite.

I wouldn’t accept Amex as a form of payment because of their high charges, and yet I practically worship my Amex card and use it everywhere its accepted.  I will conclude this part of my post by saying that if all merchants joined forces and stopped accepting my Amex card I’d stop using it and switch back to Visa or something. My Amex just happened to be my first rewards card, and its sexy as heck (Amex Clear, thank you very much.) but now that I’m getting a Visa with rewards, well, I may be more easily convinced.

Anyway….I digress. My issue isn’t that Amex is making money. My issue is that whenever I use my Amex to pay for something at a local/small business I’m taking away from their profits. (Technically that’s the case anywhere I go, but I have less of an issue taking away from Walmart, for example.)

Lately I’ve been using my card a lot at the dance studio. Its usually from $40-$100 at a time. The charges add up quickly. For that reason I’m always excited about how quickly my rewards points will add up, but at the same time….its a small business that I love supporting, and yet I realize that I could easily pay them with a check and save them those merchant charges.

And yet….I don’t.

I know I shouldn’t be too worried (and I’m not exactly worried) but I just find it amusing at how I keep putting myself first even though I have a seemingly compelling reason not to. And when it comes to my money, why shouldn’t I? After all, they do have the option of eliminating the credit card options. And yet if they did that I’m sure more people would be hesitant about paying them with a check as opposed to a card.

Not a life-altering point, but something for me to think about nonetheless.

Has the thought of merchant charges ever affected what form of payment you use? Have you ever stopped using a card based on that principle? No one’s ever mentioned it (that I know of, other than gas stations) so I’d be interested to hear any thoughts!

*And yes, I realize that with more volume a merchant would end up getting charged less than that, but its still not free to process a credit card transaction! Oh, and those numbers were total approximations. I don’t exactly remember what they charged me.

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