Credit card fees: Some gas stations say 'no more'

[UpInArms]

Source: Associated Press

CHARLESTON, W.Va. - When gas station manager Roger Randolph realized it was costing him money each time someone filled up with $4-a-gallon gas, he hung a sign on his pumps: "No more credit cards."

He may be the first in West Virginia to ban plastic, but gas station operators nationwide are reporting similar woes as higher prices translate into higher credit card fees the managers must pay, squeezing profits at the pump.

"The more they buy, the more we lose," said Randolph, who manages Mr. Ed's Chevron in St. Albans. "Gas prices go up, and our profits go down."

His complaints target the so-called interchange fee — a percentage of the sale price paid to credit card companies on every transaction. The percentage is fixed — usually at just under 2 percent — but the dollar amount of the fee rises with the price of the goods or services.

As gas tops $4 a gallon, that pushes fees toward 10 cents a gallon. Now stations, which typically mark up gasoline by 11 to 12 cents a gallon, are seeing profits shrink or even reverse.

Read more: http://news.yahoo.com/s/ap/20080618/ap_on_bi_ge/gas_prices_credit_cards

[rpannier]

1. Bigger stations will continue to let people use credit cards

Smaller stations will be priced out of the market because people will have to carry 50 bucks to fill a 12 gallon tank.

[eleny]

2. I remember the break in price offered for cash payment during the last gas "crisis"

[JerseygirlCT]

37. Which will really be an *increase* in credit card prices, not a lower

price for cash.

[cui bono]

3. There's a couple Valero stations near me that offer a cheaper cash price.

And their credit card price is the same as most stations regular price.

[napi21]

4. Fees are not necessiarily fixed. In many cases as the bill rises,

the fees go down! ie: They may have to pay a 3% on a sale of $10.00 or less, but 2% on anything over $20, and 1% over $75. The part that IS FIXED is the transaction fee which is 20¢ to 35¢ per individual transaction. The % of the sale is a negotiated rate based upon the volume of business and average sale amount.

It depends on what their competitiors do with this, but if they don't ALL go along, that manager is not going to be pleased with the outcome!

[axollot]

40. That is the way I've always heard it - my local guys....

....have told me under 20 dollars, use debit, since the fee's were cheaper, once it was over 20 dollars to use credit and/or debit since *that* is cheaper in fees for them. So whenever I hand over my card at the register and they ask credit or debit, I always say "whichever is cheaper for you" - they really appreciate that.

Our local BP is run by a great couple from Bangladesh, we talk all the time. They do not make any money off of gas (pennies on the gallon, less if you do not pay cash) they only make money if you buy the sodas, cigs, chips etc from them. I'm huge about supporting locally owned businesses and will, whenever I can buy local only. Even the grocery store, the two main chains in my area are locally owned. (meaning Florida owned) One, is slightly more expensive, but they provide great benefits even for PT employees, it's also an employee owned company (Publix for those that live in FL). Their prices are slightly higher but they pay higher wages as well as what I mentioned above.
The other is a Jacksonville FL Company, (Winn Dixie) they have much better prices and fantastic deals on meat - *but* - they offer no benefits to employees besides salaried ones. In tough times, like now (and lets be honest we haven't seen *nothing* yet) it's especially important to support local businesses.

Cheers
Sandy

[high density]

5. Screw that

If you don't have pay at the pump then I ain't wasting my time at your station.

[LeftyMom]

7. It's possible to have cash pay at the pump

ARCO AM/PM does, and I use them pretty regularly because they're cheaper than competitors and I've never had an issue with their gas.

[high density]

12. Neat, I've never seen one of those

But to be honest I rarely have the cash on hand to buy a tank of $4.15/gal gas...

[LeftyMom]

15. It's not a huge deal for me, but I've only got an 11 gallon tank.

I used to be able to fill it up for a $20 and get change back. Ah, those were the days.

[musicblind]

30. yeah they have them here too. Well in Greensboro they have them.

You put the dollars in like it was a vending machine. Very nifty! I like using them. :)

But you're right. Gas is getting to the point of 70 bucks to fill all the way up. Who has that kind of cash ON them all the time?

[Jack_DeLeon]

32. Thats certainly your choice, thats how the free market works....

we will have to see which side wins out.

[TheCowsCameHome]

6. I suppose he thinks we walk around with pockets full of cash.

No card?

I'll go elsewhere.

[Critters2]

8. Most stations here have ATMs inside. So, if you don't carry cash,

you can do that. With the damn ATM fee, of course!

[JerseygirlCT]

38. I don't use ATMs. That would mean carrying a significant

amount of cash around with me, weekly - more than $50 for a fill-up (and I have a smallish sedan, not a big guzzler!).

[woundedkarma]

9. I've seen a different mechanism here

In Ann Arbor/Ypsilanti, Michigan I've seen some gas stations which have two prices. One price for credit, one for cash. Usually $0.10 - $0.20 difference in the prices.

The cash price is usually cheaper than most stations around.

[Doctor_J]

10. My local station is charging an extra $.05/gal for cc purchase

Haven't seen that in years.

[sandsavage]

11. I find this interesting because of what happened today.

We live in the Michigan, rural area. We use propane gas. Keep a five hundred pound gas pig. This is used for the gas range and hot water heater. We heat with wood.

Got a letter today from our propane supplier. With an offer, on the lines of this thread.
If we do not pay with a credit card we will save 8 cents a gallon on propane.

Last year the propane was $ 1.96 a gallon
This year it is $2.65

The letter said it has raised its price to $2.73 this last month.

Of course we are going to pay with a check. We are retired and saving $ 40.00
and being locked into this price until March of next year sounds good to us.

The letter was written as they were doing us a big favor. LOL

[durablend]

33. I wouldn't mind them doing us a big favor!

I'd expect our propane company is well over $5 a gallon right now...I'd take 2.73 a gallon without a blink

[sandsavage]

44. There is a reason they are doing us a big favor on the propane

Stated in the letter from the propane co. We have delt with the same company for years. Always
paid as soon as they fill the tank. We have to be on automatic refill. To get this break we have to have our tank topped off. The drivers top off tanks in each area on their routes. Doing away with the
credit card payment saves them money. Staying on automatic refill, saves them money. They don't have to
travel here and there to deliver in large areas. I don't know what people are paying that are not on
this plan.

I hope it isn't five dollars per gallon! Many people heat their homes with propane here. Just don't see
how they will manage. People have it awful rough here in Michigan. In fact don't see how anyone is going to manage this if it goes to five dollars a gal.

[kestrel91316]

13. I've been paying cash at the local El Cheapo independent for years.

As a business owner who gets reamed every time someone opts for the "convenience" of plastic, I am sympathetic to these gas station owners and like to pay CASH. No fee, no hassle. No surprise for me at the end of the month, either.

And the thrill of denying a major corporation a cut of the deal.

[AndyTiedye]

16. If You Have a Big Tank, That's Gonna be a Lot of Cash

[kestrel91316]

17. 1988 Honda Accord. 14 gallons. And when I buy, it's always

either $20 even or $40 even.

[AndyTiedye]

25. At A Lot of Stations, You Have to Wait in Line Twice to Pay With Cash if You Fill It

At the Arco, you put your cash in the machine, but still have to wait in line for change if you fill it.
Sticking a credit card in the pump is a lot more convenient.

I drive a Prius, which has an 11.9 gallon tank, and tend to top it off when it's halfway down.
Using an ATM card and paying the associated fixed fees is less advantageous than
patronizing another station that accepts credit cards, as long as their prices are close.
Someone with a larger gas tank who coasts into gas stations on the vapors might find otherwise.

None of the stations around here appear to be independently-owned,
and I'm happy to let the oil companies eat plastic.

[kestrel91316]

36. I just go up to the window and give them my money. If I am due change

back, I go back for it. Which doesn't bother me in the least. Human contact of ALL kinds is sadly lacking in today's America, and I try to have a pleasant word with the clerk.

[AndyTiedye]

43. Last Conversation I had with a Gas Station Clerk…

…turned to the subject of how he really wanted to get a job somewhere else,
because the gas station was getting robbed way too often.

[Zhade]

14. There goes the only way some can get gas for the week.

There have been sadly more than a few times I've had to use my Visa checkcard to get gas when I only have a dollar or two in checking - trading gas to get to work over the next week for the economic hit (overdraft fee) next week.

It sucks, and I hate having to do it, but sometimes I've had little choice. I know I'm not the only one.

[barbtries]

19. no you're not the only one

i was happy as can be a couple weeks ago when i was able to fill up even though i knew i only had a couple bucks in the bank. happy to be paying $65 instead of $30. that's sad, but if i can't get to work all is lost...

[Trillo]

18. What about Debit Cards?

If the intent is to "ban plastic", then debit cards are included. If it's no more "credit cards", then debit cards presumably wouldn't be included.

What I've never understood about electronic currency is how it costs extra to exchange it. With paper money, there usually aren't extra fees assessed for using it or bans on its acceptance (though I have seen exceptions here and there, particularly large paper bills at night at convienience stores).

I guess my question is ultimately whether debit cards are legal tender just like paper money? (the "legal tender" phrase however, is not printed on my debit card).

[AndyTiedye]

26. Most Will Accept ATM Cards, But They Charge a Fixed Fee For Them

I don't know what the fee structure is to the merchant for debit cards.
(My impression is that they incur the same costs to the merchant as credit cards,
without any of the benefits, i.e. credit, to the purchaser).

In general, debit cards are only accepted where credit cards are, and not always then.
(Debit cards are usually refused as security for anything, like rental cars, hotel rooms, etc).

Gas stations almost always accept ATM cards though, and most debit cards are also ATM cards.
ATM fees are borne not the merchant, but by the customer, who usually has a fee tacked onto
the transaction by the merchant, and service charge for it from his own bank.

[Hardrada]

20. We have a tab at our local full service station which we pay

every two or three months. No kidding.

[goforit]

21. Banks have lost big in the sub-prime mortgage business...need more $$$.

[Megahurtz]

22. LOL yeah keep going!

:spray: Bring down those Credit Card Corporations! Fucking ripoffs! They deserve to tank!

[Carnea]

23. Who carries that much cash anymore? nt

[starroute]

24. Cash sales have built-in costs to the business

Somebody has to ring up the sales and make change. Somebody has to count the cash every night. Somebody has to bundle it up and take it to the night drop at the bank. There are more chances for errors, either in the original sales or in the tallying, which then take extra time to track down. There are more chances for employee theft -- or for employees to be falsely accused of theft -- which also takes the owners extra time to sort out.

Plastic is a convenience for the business owners in many ways. They may be using this to lean on the credit card companies in hopes of driving fees down, but I can't see them wanted to go back to a predominantly cash-based way of doing business. Like outsourcing, it may look like a savings on paper, but I doubt they'll find it worth the hassle in the long run.

[AndyTiedye]

27. Gas Stations (and Cash-Laden Patrons) Are Particularly Vulnerable to Robbery

Gas stations are often located in isolated areas near freeways.
Add the known presence of large amounts of cash, and you have a magnet for armed robbers.
They can strike and get away fast.

They won't only be robbing the station itself. They will also rob the customers, who will be an easier target.

[libnnc]

29. that's why lately I've been paying with my debit card

I don't like carrying around large amounts of cash. And so many stations now require you to pay before you pump. It would be so easy to hit someone walking from their car to the register.

[durablend]

34. Yep--I wonder if that gas station owner has thought of that

All that cash around makes him an easier target. Is it better to just eat the processing fees or just accept being robbed every once in awhile?

[JerseygirlCT]

39. Absolutely. nt

[bullwinkle428]

28. I always use a debit card - I honestly don't like to carry lots of

cash with me! Almost $60 to fill up my little Honda sedan? Sorry, but I'm sticking with plastic.

[surf]

31. About time someone took a stand.

Kudos to the gas stations to show us the way. MasterCard and Visa make money on the transaction and interest rates on their cards. What a rip off to the consumer.

[Javaman]

35. Well, if there was ever a better way to lower the price of gas this would be it.

if enough station owers do this, the credit card corps will shit.

their people will talk to the oil people who in turn will tell the WH to jump and poof! the price comes down.

[enki23]

41. Breaking: large amounts of cash changing hands at local convience store

Brilliant.

[AndyTiedye]

42. Some Stations Go to the Other Extreme, At Least at Night

There's no attendant at night, but the pumps are on, so you can get gas if you have some kind of plastic.

[Juneboarder]

45. San Diego, CA - AM/PM

AM/PM, a division of BP, here in So Cal has the kioks next to the pumps where you can input cash to pump gas; don't have to go into the store. Lots of stations here have a cash/credit price and that started for us way back when gas hit $2/gallon. I personally get all my gas from CostCo, as they are the cheapest in town, and I have to admit, I'm one of those on the verge of middle/poor class... using credit cards to pay at the pump in hopes that finances pick up in the next 6-12 months. It really sucks, and I'm sure there are many out there in the same predicament. With costs rising so quickly and wages remaining stagnant or decreasing, there is less cash available and that needs to go towards the mortgage(s) first and foremost.

One question though... what will these stations that only accept cash do when our dollar tanks. Will the currency then be silver and gold?

[truebrit71]

46. Awesome...so any criminal with half a brain will know to hit those gas stations that won't take card

...BRILLIANT!!! :eyes: