Legislation Would Allow Minimum Purchase Requirement

from The Green Sheet 5/24/10

Vermont Governor Jim Douglas is being urged to sign legislation recently passed by the Vermont legislature that would allow Vermont retailers to set a minimum credit card purchase of up to $10 without interference from Visa Inc. and MasterCard, whose rules bar minimum purchase amounts.

Card companies would also be prohibited from blocking merchants from giving discounts for cash, checks, debit cards or credit cards with lower-than-usual swipe fees. Visa and MasterCard also could not force retailers to accept cards at all store locations of a given retailer if the retailer only wanted to accept them at some locations.

MasterCard stated that allowing merchants to set minimum amounts for card purchases would require shoppers "to spend more than they might have intended if they choose to use a payment card.

"The legislation would restrict consumer choice, and allow merchants to circumvent MasterCard rules that prevent consumers from being penalized for preferring to use an electronic payment card."

MasterCard also pointed out that the new Vermont law and MasterCard's existing rules provide merchants "the right to offer a discount for cash and all forms of payment, including competing card brands.

"Using discounts to steer customers to another form of payment is preferable to minimums, as it would not lead consumers to spend more than originally intended."