Noodles Etc.: We have a problem

In Hyde Park, on 57th St., is a nice little noodle restaurant called Noodles Etc. I don’t eat there often, but every other month, I like to stop in and grab some Japanese udon noodles or a Thai dish. One problem: they have a $10 minimum purchase if you use your Visa or MasterCard. This is a problem because it violates both VISA and MasterCard’s merchant agreements. Bottom line is that they cannot do this. I would like to thank The Consumerist article that helped me find this info.

If you live in Hyde Park and frequent Noodles Etc., please stress that they should change their policy. You can file report to MasterCard concerning any violations of this nature here.

I decided to write to the owner/manager of Noodles Etc., Pattie Kidwell. Below is our email conversation.

Michael Cavalieri <> Tue, May 22, 2007 at 3:43 PM
I must take exception to the $10 minimum credit card requirement both locations enforce. According to both the MasterCard and VISA merchant agreements, this is a violation of their policies. I have excerpted both policy details and included the links for where they can be found. I hope your management changes this policy or stops violating the regulations mutually agreed to by you, the merchant, and us, the consumer. Unfortunately, since this policy has not changed in over 18 months, I feel I have no other option but to report this violation to MasterCard in the near future.

MasterCard (policy link):

“Can a merchant charge me a fee to use my MasterCard card? Can a merchant require a minimum purchase amount to use my MasterCard card?

The answer to the first question is almost never; the answer to the second question is not ever. Merchants must follow certain acceptance rules in order to be granted the privilege of accepting MasterCard cards….

…Another MasterCard acceptance rule prohibits merchants that accept MasterCard cards from establishing any minimum amount below which the merchant won’t accept payment via MasterCard card. If a merchant displays a decal with the MasterCard logo to indicate that MasterCard cards are accepted, that merchant can not condition a sale based upon the cardholder disclosing any other information or identification, except under very specific conditions, such as when merchant needs to deliver merchandise to the cardholder’s home or business.

It’s not always easy to tell whether a merchant is complying with MasterCard acceptance rules. It’s important to MasterCard that you are treated fairly and in accordance with those acceptance rules when you shop using your MasterCard card.”

VISA (policy link):

“Minimum Purchase

Visa merchants are not permitted to establish minimum transaction amounts, even on sale items. They also are not permitted to charge you a fee when you want to use your Visa card.

If you run into a problem like this with a merchant, please notify the financial institution that issued you your Visa card. These institutions have access to the appropriate Visa rules and regulations and can help you document and file your complaint. You’ll find their address and/or telephone number on your Visa statement. Their telephone number may also appear on the back of the card itself. ”

Thank you for your time. I hope to enjoy your restaurants service and food in the near future (once this violation is remedied).

Mike Cavalieri

Pattie Kidwell <> Tue, May 22, 2007 at 5:26 PM
To: Michael Cavalieri <>

Someone has told me that also and called Visa while talking to me about this issue. I’m not sure if that person is you or not, my apology. But this is our restaurant policy, if Visa or Master Card have a problem with it they know who to talk to and what to do. It is may be a violation to their rules, but their cost us 3% of the sales and more if every one start charging for each Pad Thai or Egg Rolls. I don’t want to raise our price and hurt the majority of my customers ( 98% ) who are very understanding of our policy.

When I started doing business here in Hyde Park, I committed myself to deliver good food, big portion at affordable price. I will try to find a way to stick with that without an easy way out like a lot of my vendors by raising the price. By enforcing the minimum of $10.00, it is just one way to help our business. That is also why we don’t advertise ourself that we take credit card by putting their decal on the windows. In fact, we are taking them out from our menu also.

But if it comes to the point that Visa and Mastercard don’t want our business, I can follow Salonica, Valois, and The Original Pancake House step. They seem to be doing fine without credit card at all.

Thank you for letting us know of your concerns.

Pattie Kidwell


Michael Cavalieri <> Tue, May 22, 2007 at 10:51 PM
To: Pattie Kidwell <>
This is my first mentioning of this issue, so someone else must feel the same as I do. I understand the dog-eat-dog world that your business must compete in, but unfortunately, your strategy is not my priority. While I do enjoy your food and its price, I must sincerely disagree and again stress the contractual obligation you are under with VISA and MasterCard. Allow me to elaborate point by point.

1. Clientèle
I understand that your policy is squarely aimed at the college students you must encounter everyday, looking to just charge their appetizer and soft drink and move on. However, I am an independent consultant, and to keep track of my business expenses (no matter how meager they are), I use one credit card for all consulting related expenses. But according to your policy, I cannot use my credit card for my typical one-person meal. But, if I happen to bring a client along and our bill totals above $10, my credit card is now more than welcome. This is discrimination, pure and simple. You are discriminating against either those who dine alone or those on a budget.

2. Contractual obligation
When I use my credit card, I am under certain contractual obligations to pay my debt in a certain amount of time. If I do not pay my balance, I am charged with an interest rate. I cannot say to MasterCard, “I only have a $200 balance and paying it right now is inconvenient for me, so I will just ignore your minimum balance and late fees. It will help my business.” Doesn’t fly for me and it shouldn’t fly for you. If you do not like the point-of-sale opportunities afforded to you by the major vendors, then yes, I agree, you should drop them all together. But sticking the cost of your disapproval of their terms of service to me, the under-$10 diner, is unfair and unethical. You agreed to VISA / MasterCard’s contract when you signed on. You cannot change the rules when the going gets tough.

3. Customer reaction
Apparently, the other restaurants in the area are doing just fine with their policy of no cards. And yes, the neighborhood customers must like this system. But Medici uses credit. So does Subway. So does Eduardo’s. I don’t seem them raising prices beyond market value to keep up with fees. The truth is, though, you want the higher priced clients of Eduardo’s and Medici, but you want the low overhead of Salonica and OHP. You cannot have it both ways. People goto Saolinca or OPH for eggs, toast and a cup of coffee. $6 on average. If I remember right, your entrees start at around $6, not including a drink or appetizer. Salonica, et al, are places that serve all three meals, and therefore, carry more customers on average per day. Medici, Eduardo’s and you sit squarely for the lunch and dinner crowd, which, on average, spend more per meal. I suggest the following: drop the cards. If your diners have no problem, they will keep eating at your establishment. But deep down, you want the party of six who just ate $72 of dinner to eat assured, knowing that they can use plastic without a problem. If they knew they had to pool cash together and figure out individual items, they might move down the road to Medici or Eduardo’s and just charge it. Of course, that’s not a favorable scenario for you. I would like to see you address them at the end of the meal and politely decline their card because you do not honor the cards due to the transaction fees. We both know that scenario is not realistic in today’s world. I would go as far to venture that if more people knew you were violating your contract, they would have some questions for you as well. You can only hide behind people’s ignorance for so long.

Just drop the cards. Put everyone on a level playing field to focus squarely on the good service, quality, and quantity. Better yet, add a 3% discount if paid with cash. Both are legal and contractually available. But do not continue with your current policy. It is a violation against your contract and a breech of trust to the customer.

I thank you for your time and consideration.



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