At the Courtyard Café on SRJC’s Petaluma campus, you can buy lunch, a bottle of water or snack on a donut, but if it comes to less than $3, you won’t be able to use your credit card.

While this practice may be tough on students who only want a quick snack and left their cash at home, it is part of a bigger problem. Customers making small credit card purchases create a problem for merchants. Every time a merchant processes a credit card, they incur fees and charges. When the cost of a purchase is low, the merchant may actually lose money on the transaction.

The Courtyard Café is not the only merchant on campus grappling with this problem. The bookstore also has a $3 minimum on credit card purchases, but has begun to find that this is not enough to offset their costs. According to Doug Roberts, SRJC vice president of business services, has asked if the bookstore can raise its minimum to $3.50.

Charging minimum fees is more than just an annoyance, it is expressly forbidden in the merchant agreements required by both MasterCard and Visa. “A Merchant must not require, or indicate that it requires, a minimum or maximum Transaction amount to accept a valid and properly presented Card.”

While credit card companies have a system in place to report merchants who abuse the agreement, it may not be in the best interest of the customer. If it becomes economically unfeasible for the merchant to accept credit cards, we will lose out on the convenience they offer.

Roberts said it was an interesting problem. “The students, the college and the district have a vested interest for Fresh and Natural to stay in business.”

To remain within the letter of the merchant contract, Fresh and Natural has three options. First is to stop charging the $3 minimum and risk taking a loss on some of their credit card purchases. Second, they could stop taking credit cards all together. The third option would be to give a discount for cash purchases. This is allowed in the merchant agreement.