Stores and restaurants are asking Congress for relief on high credit card transaction fees, and they make a good case.
Despite our supposedly sophisticated financial system, the fees US retailers pay to accept credit cards, 2% to 3% of every transaction, are the highest in the world.
Senators from both parties introduced a bill last month to reduce fees.
In return, though, stores and to-go restaurants must stop making us navigate ever more complex screen interfaces just to pay for our socks and pastries.
If you’ve been to the United Kingdom or Europe in the past five years, you see how easy paying for something can — and should — be.
Buy a paperback book, buy your morning croissant or buy a freshly killed chicken at the farmers’ market, and all you do is tap your card or your phone against a tiny machine, hear a satisfying beep and leave.
This works at fancy department stores and at the funfair.
(For larger transactions, Europeans must enter a debit-style code on the machine’s touchpad, but this is predictable and straightforward.)
It takes seconds and requires no thinking — you can use this time to thank the clerk and bag up your purchase.
In America, by contrast, you have no idea of the obstacle course that awaits you in executing the simplest transaction.
This despite billions of dollars in investment — by credit card giants, banks and some retailers — that make our system, theoretically, as easy as Europe’s.
Finally, for example, a decade after they were common in Europe, we all have contactless microchipped cards (or phones enabled with the same technology), faster and safer to use than old-fashioned magnetic-strip cards.
Instead of convenience, though, we face new and pointless inconsistencies.
Some merchants’ terminals require you to OK the purchase-price total; some don’t.
Some require this approval before you tap your card, others after.
Some terminals will accept a tap; others require a card insertion.
Bizarrely and inexcusably enough, you may still have to sign a touchscreen to move your payment along.
Retailers can’t blame the credit card giants: Mastercard and Visa stopped requiring signatures five years ago.
Signatures are now valueless in preventing identity theft; your squiggly line, made with your finger or a touchscreen pen — which you must first find hanging off the console somewhere — looks the same as everyone else’s squiggly line.
So why, at the wine store and the ice cream cart, are we still pressing green for “Yes” and signing?
Because some merchants just haven’t updated basic equipment — even though this failure forces customers to wait longer, deterring people from shopping in person.
One might have thought the pandemic would have spurred merchants to fix this.
But no, in March 2020, you were still using your grubby finger to touch the same screen dozens of other people had already touched that morning, as coughing people waited behind you in line.
Some stores want us to type in our phone number. Some our email.
Some want us to donate money for school supplies or sick cats.
Worst is the tip screen.
It’s like all the coffee shops, bakeries and gelato shops said, Hey, the credit card companies just made my and my customers’ life a whole lot simpler. How can we make it even harder and more frustrating, and take longer, than it ever did in the olden days of magnetic cards?
The problem is not that you’re being coerced into paying an extra $2 for two $5 croissants.
The problem is more inconsistency and potential for mistake.
Some merchants start their three-choice tip range on the screen at 15%, some 20%. At some places, the top option is 18%; at some, it’s 30%.
(And yes, people have accidentally left hundreds of dollars via the “custom” choice.)
Merchants are sending directly conflicting signals to customers.
You are being asked, reasonably enough, to efficiently move along for the next person behind you — at the same time you’re being asked to pause and make a deliberate, five-range choice (when you include “no tip” and “custom tip”).
Nobody likes this predatory microaggression.
If a store wants to pay workers more, raise prices and do it — the customer paying $7 for an ice cream cone will probably pay $8.50 for an ice cream cone.
So fine, maybe Congress should lower merchants’ credit card fees.
In return, merchants should stop stressing, flummoxing and tricking their customers. Let us tap for our cannoli and go.
Nicole Gelinas is a contributing editor to the Manhattan Institute’s City Journal.
