Convenience Store Owners Protest Credit Card Fees
November 10, 2009
By: Joe Taylor Jr.
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Capitol Hill played host to an unusual group of protesters this fall, according to a recent report in U.S. News and World Report. Thousands of 7-Eleven convenience store franchisees and their staff members rallied in Washington to support proposed legislation that would change the structure of interchange fees on electronic payment platforms.
Typically, merchant banks charge companies two kinds of interchange fees for the privilege of accepting credit cards: a flat fee for processing, plus a percentage of the total transaction amount. At most retailers, these fees add up to between two and three percent of a retail purchase, a figure that can often be passed along to consumers through slightly higher pricing.
The flat-rate portion of an interchange fee often costs more than a candy bar or a pack of gum. With Americans making smaller purchases on debit and credit cards, some small retailers have asked for government intervention. Lawmakers have already proposed a restructuring of credit card processing fees that could significantly lower prices for retailers, at the expense of frequent flyer and cash back reward programs for high-volume purchasers.
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