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Would You Pay More to Use Plastic?

Nearly 95% of readers say they would not make purchases with a credit card if they had to pay a surcharge, according to a recent online poll. But many of them already do — at the gas pump.

Merchants are pushing for the right to charge extra for credit-card sales to cover the 2% swipe fee issuers charge for every purchase, the Journal reported Monday. Although retailers are prohibited from implementing surcharges under a settlement agreement with Visa and MasterCard, they are allowed to offer a discount for cash purchases — a distinction many experts say is mostly semantics. “One man’s cash discount is another man’s credit-card surcharge,” says consumer advocate Edgar Dworsky.

Gas stations have embraced the dual pricing for some time, and if the pump is any indication, consumers are willing to pay extra for the convenience of plastic. Credit- and debit-card purchases account for 70% of spending at gas stations, according to a survey by research group Phoenix Marketing International. Experts say the data suggests that Americans will pay a few cents – or even dollars — extra to use a credit card.

Some may not even notice the price difference. With many rewards programs and fraud protection packages encouraging people to use plastic, many “make up their minds they’re going to pay for their gas with credit cards before they’ve even driven up to the pump,” says John Ulzheimer, president of consumer education at, a credit-monitoring site.

Higher prices have forced an increasing number of gas stations to offer dual prices, says Jeff Lenard, a spokesman for the National Association of Convenience Stores. One local TV station spotted 18 gas stations in Long Island, N.Y., with dual pricing, some charging $2 per gallon more for paying with credit cards.

If surcharges are permitted, some experts say credit-card prices could be hiked far higher than the current 2% swipe fee. “In other parts of the world where surcharges are allowed, sellers have taken advantage of consumers,” Dworsky says. When credit-card surcharges were introduced in Australia a decade ago, some retailers raised the fees to as high as 10% of the purchase price, according to a 2010 survey by the New South Wales Minister for Fair Trading. And when transaction fees for U.S. debit-card purchases were slashed last year, 57% of retailers raised prices, according to the Electronic Payments Coalition, an advocacy group for banks. “The same thing will happen with credit cards,” he says.


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    • Thanks for sharing such great posts. Your weisbte is so informative and filled with really great content on ATMs.. I’m impressed by the articles that you’ve written it shows how well you understand the subject. I’ve bookmarked your web page and plan to return regularly for additional great updates. Thanks again, your hard work is appreciated!

    • A particular cpoamny has my attention. BRFS. Brasil Foods. They are a major chicken exporter. The reason they have my attention is YUM Brands has announced they will triple the KFC outlet total in Africa over the next few years. Africa will have oil money to spend, and the shipping distance is minimal.

    • What you seek does not exist. The lenders make huge potfirs on Cash Advances. If you went to a bank for a cash advance you would fill out 15 pages of paperwork and wait 2 days. With a credit card, you just get $500 like magic. No paperwork or waiting. The credit companies even send you checks so you can get money faster. But you have to pay a lot for the ease of getting money with no questions asked.

    • NO I will pay cash—as it is there are to many taxes in California, plus in San Francisco extra money on many restaurant tabs for health services for staff.

    • I buy gas with a credit card because I don’t get a discount that makes it worth my while to go to an ATM and grab cash. On a $3.50 per gallon purchase, I want to see a discount of at least 10c. If my CC is giving me 5% this month, it’s worth 16c.

About Pay Dirt

  • Pay Dirt examines the millions of consumer decisions Americans make every day: What to buy, how much to pay, whether to rave or complain. Lead written by Quentin Fottrell, the blog examines these interactions, providing readers with news, insight and tips on shopping, spending, customer service, and companies that do right – and wrong – by their customers. Send items, questions and comments to or tweet @SMPayDirt.