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04/10/2010 -
Recently, the California legislature passed a bill that would prohibit retailers from charging customers a surcharge when using their debit cards at point-of-sale terminals to complete transactions.The bill, sponsored by state senator Jenny Oropeza, was passed largely along party lines by a Senate vote of 22-9 and an Assembly vote of 45-22. While the bill bans these charges, it does allow merchants to offer discounts to customers who choose to use another method of payment.
However, the bill will now face an uphill battle if the legislature hopes to see it signed into law. Last week, Governor Arnold Schwarzenegger vetoed the bill, saying that he was concerned the surcharge law would shift the monetary burden to all consumers.
"Instead of charging a customer who chooses to use a debit card, businesses would be forced to increase their prices to all customers, regardless of payment type, to cover the interchange fee," Schwarzenegger wrote.
The measure was supported by both consumer groups and credit card issuer Visa, who claimed it would prevent merchants from advertising low prices only to raise them at the cash register.
