Chapter 14 Blog

http://www.canada.com/nanaimodailynews/news/business/story.html?id=c51386a6-2f5d-426c-9c4b-846e802ef3f6

Summary:

The article talks about how people don't know or don't care about the extra transaction fee they have to pay for using their credit cards. Montreal merchant, Tony Fargnoli, explains that 90% of his sales on thanksgiving were paid on debit or credit cards. People don't realize that everytime they use their debit or credit card, they have to pay a transaction fee to the card company, and lately Visa and Mastercard had been boosting the fees. Derek Nighbor, senior vice-president at the council, says that, the premium cards makes things hard. The fee right now is 2%, but they add .2 - .6% to the fees. Retailers would have to increase their prices to fight the fees.

Connection:

The connection between this article and chapter 14, is the use of credit cards. Many people do not know, but banks charge a series of charges such as, transaction fees or annual fees to card holders and interest rates, annual fee charged to each merchant, and the bank also deducts a percentage of the discounts you get from using credit cards. Credit cards can be useful for merchants who do not have enough money in their bank account, because a credit would offer a credit line for the customer, where he/she can still use money even if they do not have money in their bank account up to a certain point.

Reflection:

I think that credit cards are very useful, and the bank is making money off of us. First, we deposit money into banks, then we have to pay charges for the credit card. Then we get annual fees charged on us. Finally, some banks would charge us transaction fees whenever we use their credit cards. I think that what the banks are doing is just to make some money for themselves. We use their credit cards, but it is our money. We should not be charged with transaction fees when the money we're using is just our own. I think that the banks are just too unfair, they charge us fees on using our own money. But of course, they hold our money, so we can't complain too much.