Merchants are not allowed to charge you an extra sum for accepting your credit card - if this happens you should bring the matter to the attention of the bank that provides the merchant with credit card facilities.
A reader visited a branch of a motor parts franchise to buy an exhaust and inside the shop was a large notice saying the company would charge an extra five percent to customers using their credit cards or cheques.
Having established, after some extensive telephoning around, that the franchise was a client of Nedbank, he queried whether the extra charge was permissible and, if not, what consumers could do about it, besides boycotting the business.
The reason - not the excuse - that some retailers are charging you extra to use your card is that the banks levy a fee on retailers for credit card transactions. The average fee levied is 2,5 percent of each transaction - rarely five percent.
An industry spokesman explained that there is a difference between the acquiring bank (the retailer's bank who handles the transaction) and the issuing bank (responsible for whichever bank's credit card the customer happens to be using). The acquiring bank pays most of the fee it collects from the merchant to the issuing bank whose credit card was used, and this fee covers the risk to the issuing bank.
As soon as a credit card transaction is authorised, the customer walks away with the goods and the merchant receives the money, but the bank that houses the credit card still has to receive payment from its credit card customer, and bears the risk that payment will not be made.
For a retailer accepting only cash, losses from hold-ups and forged notes, and the costs of additional security, may well exceed 2,5 percent of his sales, but this may not be apparent to him. By accepting credit cards, he may also be attracting more customers than he otherwise would.
A reason that some retailers are tempted to add a surcharge to credit card customers is that they may be operating in highly competitive industries and feel that they are already selling their goods at a discount, so cannot afford to lose a further R2,50, or whatever, for every R100 transaction.
Gerald Kitchen, the general manager of Nedbank's card division, says a levy on credit card transactions is not only contrary to the terms and conditions of the standard merchant agreement, but also contravenes the agreement between acquiring banks and card associations.
"Merchants who adopt this practice face termination of their agreement," he says.
If you see this happening, you should report it to the retailer's bank.
But how do you find out who the retailer's bank is? Particularly if your discussions with the retailer have become hostile, you may not receive a reply to this question. One clue may be to look at the machine that the retailer swipes your credit card through, since the banks brand the card-readers they issue to merchants - Speedpoint for First National Bank, Autolink for Standard Bank, Bankteller for Absa and Nedlink for Nedbank.