By Michael Schreiber
Just one day after announcing that it would charge its wireless customers $2 for one time credit and debit card payments made over the phone or online, Verizon has scrapped plans for the new fee.
The company cited customer feedback for the abrupt reversal.
“At Verizon, we take great care to listen to our customers,” said Dan Mead, president and chief executive officer of Verizon Wireless, in a press release. ”Based on their input, we believe the best path forward is to encourage customers to take advantage of the best and most efficient options, eliminating the need to institute the fee at this time.”
Other factors may have played a part in the course change. Credit.com’s personal finance expert Gerri Detweiler wrote a piece which explored the question of whether or not the new fee could be considered a surcharge for credit card users. Surcharges for card use are expressly forbidden by Visa and Mastercard, and prohibited in a number of states. She writes:
“Generally, the card companies – and state law – allow discounts for those who pay by cash or check. But if you’re a merchant and you want to go that route, you can’t just call a surcharge a cash discount.
"You actually have to offer a discount off the retail price for those who pay by cash or check. If Verizon did that, it would mean that customers who paid with online ACH withdrawal, or in person by check or cash, would actually pay less than they are paying now…
"The card companies really aren’t terribly fond of merchant’s attempts to pass along the merchant fee to cardholders, since it may discourage cardholders from using their credit or debit cards to pay bills or buy merchandise. If they allow Verizon to impose this fee, then what’s to stop any company that accepts credit card payments online or by phone from adding a convenience fee?
"Theoretically, at least, a store like Best Buy or an airline – both of which have physical and online presences – could impose a surcharge for online payments and call it a convenience fee.”
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