Credit Card News: Card Issuers

Selected cards: 0
Advertising Disclosure
Gas Stations Lobby Against Swipe Fees
5 Aug
Convenience store owners continue to fight back against fees that they claim are killing their industry and draining profits. But after years in court, it seems swipe fees are here to stay.

Every time a consumer pays for a product or service using a credit card, a fee called an interchange fee—or swipe fee—is charged to the merchant accepting the payment.

Merchant absorbs fee

This fee, usually about 2% of the total transaction, covers payment processing costs for credit card networks Visa and MasterCard. The merchant absorbs the fee, since laws in many states prohibit them from passing it on to the consumer.

However, independent gas station owners represented by the National Association for Convenience and Fuel Retailing (NACS), say that the fees are on the rise. NACS statistics show that there was a 21.6% increase in credit card fees in 2010, and a rise of 23.3% in 2011. This cost convenience stores an estimated $11 billion in profit during 2011, according to NACS. In 2012, that rose even higher to $11.2 billion in fees.

On top of already high gas prices making consumers wary of the fuel pump, gas station owners say that interchange fees cost them another 7 cents per gallon in profits. These two factors combined, say merchants, are crippling their industry.

Different networks charge different fees

MasterCard and Visa have been singled out by NACs because, unlike American Express and Discover, which set interchange rates independently, MasterCard and Visa are governed by an association that also works with member banks and sets fees for all Visa and MasterCard credit cards.

That’s because Discover and American Express operate their own credit card networks and are, in essence, credit card issuer and bank in one. But MasterCard and Visa are payment networks that issue cards for big banks like Chase, Citi, Bank of America and Wells Fargo.

The antitrust lawsuit against MasterCard and Visa has been going on for over seven years and a settlement has still not been accepted by all plaintiffs. The settlement, at $7.25 billion, would be the largest ever antitrust payout. It was offered by MasterCard and Visa in the summer of 2012 and is in the process of being approved.

Meanwhile, gas stations are still paying swipe fees on every credit card transaction, and customers who are used to the convenience of paying at the pump are not likely to start paying cash at the register anytime soon.

Read Also Related News

looking for a Credit CARD:
Credit One Bank®: Credit One Bank® Platinum Visa® with Cash Back Rewards
Apply Online
Qualified applicants will enjoy benefits including 1% cash back rewards on all purchases, no annual fee, and a competitive APR. Terms apply
The Bank of Missouri: Milestone® Mastercard® with Choice of Card Image at No Extra Charge
Apply Online
Prequalify for a card today and it will not impact your credit score
Horizon Card Services: Horizon Gold
Apply Online
Instant $500 Credit Line. No Credit Check.
Credit One Bank®: Credit One Bank® Platinum Visa® for Rebuilding Credit
Apply Online
See if you Pre-Qualify without harming your credit score
Want to Read News From Other Categories?
Your Money
Card Issuers
  • 18 Nov

    Starting this month, Discover is finally introducing the contactless feature for all their Discover it® cards and the Discover More® card (the old version of the Discover it® Cash Back) joining such major issuers like American Express, Bank of America, Capital One,...

Customer Questions

  • To set a PIN on your credit card, you should call the credit card issuer at the number on the back of your credit card and request your PIN. After that, the issuer will mail to you your PIN. In the meantime, if you need cash, you can go to a bank office and present your credit card and picture ID.

  • Avoiding your credit card bill will do a lot of damage on your credit and you will need a good deal of time and effort to undo it. When you miss a payment, you get slapped with late fees. If you do not make a payment for an entire billing cycle, you’ll be considered 30 days past due and this will be reported to the...

  • The overall process of getting a credit card can take up to 30 business days. To know the status of your credit card applications you should contact the credit card issuer. A quick online search for the bank or credit card issuer's name should turn up a customer service phone number or email address. Banks and credit card...

  • If your security code is rubbed out, contact your credit card issuer and explain them your situation. Most likely you will be offered a replacement card. Your credit card issuer will not provide you with the security code over the phone or via email. That's for your own protection.

  • About Us
  • Contact Us
  • Privacy Policy
  • Terms of Use
  • 0 Selected Cards Compare