How Soon Will Merchants Start Charging You More to Pay With Plastic?

A settlement by Visa (V) and MasterCard (MA) with merchants last week should make you think twice about putting purchases on plastic. Now, it's going to be easier for companies to add surcharges for credit card purchases -- surcharges that will almost certainly make shopping more expensive for you.

Until now, merchants weren't allowed to charge those buying with credit cards a higher price, although they could offer discounts if you bought with cash. But last week, an antitrust settlement to pay retailers as much as $7.5 billion opened the door for surcharges, and could impact the way you shop.

Small Change Adds Up to Big Fees

Retailers have been between a rock and a hard place for years as consumers have shifted more of their purchases from cash to credit. With competition for consumer dollars so fierce, retailers had to keep margins low in order to keep bargain shoppers coming back. At the same time, credit card fees were eating into their already-slim margins.

The settlement could alleviate some of that pain, especially for small businesses.

While large companies have been able to negotiate rates and get the benefit of economies of scale, small businesses have had to play -- and pay -- by the rules set by someone else.

The price for accepting credit cards is nothing to sneeze at. Square, the popular mobile payment system, for example, charges 2.75% of each transaction as a fee for swiping a credit card. That adds up quickly, especially if you're a small retailer.

Slipping the Surcharge Onto Your Tab ... or Not

It'll probably start as a trickle, but during the next few months you'll see surcharges being tested here and there, particularly at places that have low dollar-amount sales (like fast-food joints, where it's costly to accept plastic for a $3 transaction).

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Another place to watch for the added fee is at the supermarket. With their super-slim margins, grocery chains could greatly benefit from the ruling if they are able to add a few bucks to each transaction. Keep an eye on gas stations too. With gas between $3 and $4 per gallon, the additional fees could be significant.

It's not a slam dunk that every merchant will begin adding credit card surcharges. After all, angering consumers isn't a way to build a sustainable business. And there are good reasons for merchants to keep covering the cost of accepting credit cards.

Plastic has become an easy payment method that is preferred by millions of consumers and has shown to lead to larger purchases than cash.

Also, there are transaction costs associated with any payment method. For instance, checks come with the problems of bounced checks and clunky record-keeping. And while cash is nice, retailers with large amounts of it on hand need to keep it secure and physically deposit it at a bank on a regular basis, which takes time and effort.

Retailers won't want to lose sales over new fees, and Visa and MasterCard may have helped by lowering their fees for a short time, which may be enough to keep retailers from passing fees on to you in the near term.

Motley Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool. The Motley Fool owns shares of MasterCard. Motley Fool newsletter services have recommended buying shares of Visa.