Summer driving season is upon us, with gas prices and tempers both running high. To show their anger over credit card fees they say are boosting fuel costs and erasing profits, gas station owners are taking action.
The National Association of Convenience Stores, a retail trade group, will provide free pumptopper signs to gas stations in an effort to educate consumers and Congress beginning later this summer. “Pumptoppers typically contain promotional messages about the store, but these will communicate the industry’s fight against sky-high interchange rates,” says an NACS press release. The pumptoppers will encourage drivers to visit unfaircreditcardfees.com to send a message to their elected officials.
According to NACS, credit card fees cost convenience stores $7.6 billion last year, more than double the industry’s profits of $3.4 billion. In 2008, credit card fees have topped 10 cents per gallon as the markup on a gallon of gas has averaged only 11 cents for the year so far. “After factoring in all operating expenses, retailers lose money on every gallon of gas they sell when a consumer uses a credit card,” the association says.
“The credit card fees that retailers pay are outrageous,” NACS President and CEO Hank Armour says in the press release. “Congress needs to see the pain that credit card fees are causing in their home districts.”
Click for gallery of rally images
NACS is encouraging gas stations to display the pumptoppers between Aug. 1 and Sept. 6, when a Congressional recess means members will be in their home districts. The House (H.R. 5546) and Senate (S. 3086) bills introduce bipartisan legislation in the form of the Credit Card Fair Fee Act to examine credit card fees, specifically the interchange rate, which the NACS press release says is the largest component of the credit card fees that retailers pay every time they accept plastic.
This morning, Irvine, Calif., consumers and gas station owners participated in a rally to support the Credit Card Fair Free Act. Rally coordinator Mitch Goldstone told me he was “very encouraged” by the turnout. “I planned it to occur as the nation prepares for the July 4th Independence Day holiday to draw attention to MasterCard and Visa’s most unpatriotic and un-American windfall profiteering by them and its member banks,” Goldstone says.
“U.S. interchange rates are the highest in the industrialized world. On the eve of the most patriotic day of the year, we really need to ask why we are paying more than Australia (0.5 percent) and in the U.K. (0.7 percent), or nearly anywhere else,” he says. Goldstone is editor of the blog WayTooHigh.com and president and CEO of ScanMyPhotos.com and 30 Minute Photos Etc.
“The rally was a turning point in my legal battle against Visa and MasterCard because it just became very public; until now, consumers didn’t seem to understand that MasterCard and Visa take in for its member banks nearly $1 billion every week in this hidden tax,” Goldstone says.
See related: Visa changes aim to ease gas pain, Gas prices take toll on family visits, Gas buyers fume at credit, debit card limits, ‘blocks,’ Coping with the gas pump
Looks like I just squeaked onto the list for the latest incarnation of the Finance Fiesta blog carnival for my post “American Bankers Association reports increased card delinquencies.”