Credit Card Fees
NACS retail members cite credit card fees as their third largest store-level operating expense, following labor and rent. In 2005, the convenience and petroleum retailing industry reported a pre-tax profit of $5.9 billion and $5.4 billion paid in credit card fees. At the motor fuel dispenser, credit card fees are often greater than the profit a retailer earns on each gallon sold. The largest component of these fees is interchange, a fee charged by the cardholder's bank to the retailer's bank and passed on to the retailer. Across all industries, in 2001, Visa, MasterCard and their issuing banks collected $16.6 billion in credit card interchange fees. By 2005, these fees increased to $30.7 billion – more than the total amount of penalty fees and ATM fees combined. Interchange fees are far higher than the actual processing costs and risks involved, yet these transactions fees continue to rise.

NACS and our Government Relations staff are currently urging Congress to persuade the credit card companies to explain their fees, practices and policies to us and the public. This issue is a primary focus for NACS and will most likely remain so for the coming years. NACS is the named plaintiff in a class-action suing not only Visa and Mastercard, but also their issuing banks. This suit has been combined with over 40 other suits and has been given the lead status in the U.S. District Court for the Eastern District of New York. At the same time, NACS has helped form the Merchant's Payment Coalition (MPC), which is working for a more competitive and transparent credit card fee system that better serves American consumers and merchants alike.