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Stores Now Setting Minimum Purchase Requirements

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Stores Now Setting Minimum Purchase RequirementsMany small businesses in the U.S. have recently set minimum purchase requirements for credit and debit card transactions to around $5 or $10, according to a report from Cleveland, Ohio, television station WEWS. Retailers say in an effort to cut the amount of fees they pay to credit networks, which can rise to tens of thousands of dollars annually.

This change has come because federal law now allows merchants to set minimums, the report said. Previously, the networks prohibited them from doing so in exchange for allowing customers to make credit and debit card purchases.

Most small businesses say they operate on very thin profit margins of just 2 or 3 percent, meaning that high transaction processing fees can take a large bite out of their profits, the report said. For credit and debit transactions of a few dollars, many independently owned companies may actually lose money.

Consumers whose purchases don’t exceed vendors’ minimum can avoid the problem by carrying cash instead.

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  • Gina

    this is actually somewhat incorrect. While under the Durbin Agreement, they can set a minimum of up to $10 on CREDIT card purchases, they are still not allowed to set a minimum on DEBIT card purchases. It will go against their agreement with VISA and Mastercard if they do set a limit on debit card purchases.

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