Why do gas stations charge more for credit card purchases?

in the year of our Lord 2024, who still carries cash? I don't know, but one day when I full of gas I regret my decision to stick with plastic money instead of paper money Because card transactions are 20 cents more expensive per gallon. Why Gas station Adding extra fees to card transactions? That's because credit card companies charge an average of about 2.5 percent of each credit card transaction, according to the National Association of Convenience and Petroleum Retailers (NACS).

The national average price per gallon of gasoline in October 2022 was $3.76, which means card companies charged about 9 cents per gallon. Gas station Margins on gas sales are typically lower, so the extra cost of buying gas with a credit card can alleviate the fees retailers pay, according to multiple sources including BestCards and Chase Bank. I always thought the extra fees for buying gas with the card were excessive, but they turned out to be necessary.

Surcharges charged by individuals as gas prices rise Gas station Also needs to be increased. At an average rate of 2.5%, a $50 transaction would require the retailer to pay the credit card company $1.25. If gas costs $5 a gallon, a $50 transaction only includes 10 gallons of gas, and with the 10 cents added, the gas station only gets $1 to cover the 1.25 the card company takes from the transaction. Dollar. As natural gas prices rise, this pattern grows exponentially. KTLA 5 Report,

Gas station profits are slim; According to best card, and due to fierce competition from other gas stations, prices are set as low as possible, above the cost of buying from the supplier, in order to demonstrate the lowest price possible (while still bringing in enough profit to stay in business )go). This results in different price points being displayed on signs outside, as lower prices displayed may encourage more drivers to fill up at that location.

In addition to nerd statistics, there are several ways to Minimize the money you spend Gasoline is accepted regardless of whether you use cash or card. Chase.com It is recommended to pay with cash, or use a rewards credit card or gas rewards account. Carrying cash is definitely a way to pay the lowest prices at the pump, just keep in mind that some cards charge ATM fees when withdrawing cash, and sometimes these fees can exceed the savings you'll get by paying for gas with cash.

Some oil companies offer rewards programs, such as Shell's Fuel Rewards program, where members receive 5 cents off every gallon of gas, and if you fill up at least 12 times in three months, you can unlock platinum status, where members can earn 5 cents off every gallon of gas. Enjoy a 10 cent discount. Some rewards credit cards offer up to 5% cash back on specific spending categories, including gas, so check your credit card's terms to see if your card offers any gas savings.

Swear next time you go to get gas. Gas station For rising card transaction prices, point frustration at the root of the problem, which is greedy greedy bank. Don’t be afraid of gas station rewards programs, either, as they are an easy way to save some money when you pump up the gas.

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