There are still fees for the retailer, and on lower cost purchases, the fees tend to be higher. That’s why stores often have a $5 minimum for cards. They don’t want people buying a pack of gum with their debit card, and end up costing them more than the meager profit.
The fees on CREDIT cards are confusing, with the percentage changing based on volume, etc. I once found a really good explanation online, and it made perfect sense for about 15 minutes, and then it faded again.
Debit cards usually have a fixed fee per transaction, as well as a percentage based on volume. Credit cards don’t have that fixed fee, just a percentage of the total, so they don’t care if you use it on a small purchase.
But if the fixed fee is 50 cents, and you buy something that is 50 cents, they literally lost money. Even in a case where the item is 2 or 3 dollars, that 50 cent charge is a big hit to the profit. Do that 100 times a day on things like cans of soda and candy bars, and much of your profit on those items gets eaten by the fees, and those things are a BIG part of the profit for something like a convenience store.
There are still fees for the retailer, and on lower cost purchases, the fees tend to be higher. That’s why stores often have a $5 minimum for cards. They don’t want people buying a pack of gum with their debit card, and end up costing them more than the meager profit.
no, it’s a percentage of total monthly transactions. The $5 minimum is a bullshit excuse to make you buy more.
The fees on CREDIT cards are confusing, with the percentage changing based on volume, etc. I once found a really good explanation online, and it made perfect sense for about 15 minutes, and then it faded again.
Debit cards usually have a fixed fee per transaction, as well as a percentage based on volume. Credit cards don’t have that fixed fee, just a percentage of the total, so they don’t care if you use it on a small purchase.
But if the fixed fee is 50 cents, and you buy something that is 50 cents, they literally lost money. Even in a case where the item is 2 or 3 dollars, that 50 cent charge is a big hit to the profit. Do that 100 times a day on things like cans of soda and candy bars, and much of your profit on those items gets eaten by the fees, and those things are a BIG part of the profit for something like a convenience store.