Gas stations are giving discounts to customer's that pay with cash. Gas station owners aren't making profits from gasoline sales since they have to pay for credit card transaction fees. I don't understand this. I have my money direct deposited & use my bank card (as credit) all the time. It's very rare that I have cash on me. Also, don't you have to pay first when using cash? That won't work for me. Most people don't know, but when filling up their vehicles, when the gas pump automatically stops... you shouldn't put more in to make it an even dollar amount. When it stops, your gas tank is full & it's better for your car.
Gas (Paying Cash)
Comments ... #
Why are only gas stations not making profits due to these transaction fees? I don't see restaurants offering me 10% of my bill if I pay with cash. What other "vendors" offer discounts for cash paying customers?
It is a violation of the vendors MasterCard/ Visa contract to put any monetary limits on accepting credit or debit cards. If you really feel that a small store owner should take your debit card for a bottle of pop and a pack of gum and take a loss on the sale because the interchange fees to process the transaction cost more than the profit margin he operates on go for it and complain to your card issuer. That's how bad the debit/credit card issuers are into the pockets of the merchants who have to accept them. A merchant does not have to accept a debit/credit card for lottery tickets, utility bill payments, money orders or Western Union services. Why? Because the merchant is charged a percentage of the total sale, plus other fees. The debit card in particular is the worst thing to happen to the small merchant. The debit card is the reason WalMart wants to be a bank. To get out from under the tyranny of the interchange fees.
Got a card with perks like miles, or rewards? The card issuer doesn't pay for those perks or rewards. The merchant is charged a HIGHER fee for accepting those types of cards, The merchants actually fund all perks and rewards programs by all card issuers. So the next time you get a card reward thank you local merchant. He's buying.
Well, if its too inconvenient for you to pay cash, you can still use a credit card at the pump...consider the surcharge a "convenience fee."
Also...I believe some, if not most, gas stations consider gift cards to be a "cash" purchase. As an alternative, you could consider purchasing a gift card and using that to pay at the pump. Of course, make sure that the specific gas station you use will give the "cash price" for a gift card before going that route.
@Holland: I'm talking about gas purchases! I didn't say anything in my post about pop or a candy bar.
@mom2: I never said it was inconvenient. I just said it wouldn't work for me as I don't carry cash. If for whatever reason I had cash on me, I would have no problem going inside to pay.
If gas stations aren't making profits because of people paying with credit cards, why don't they just stop accepting credit cards and take cash only?
Re: The discount for cash pmt. It is driven by the same need for the merchant to reduce the costs of accepting credit/debit cards. The cost of credit card processing fees is often equal to or greater than the profit margin on the sale, especially a small sale, whether it is a gallon of gas or a candy bar. The American consumer is living today with tomorrow's money via credit card use. Credit card issuers and banks push card use. Ever wonder why banks will pay you 10 cents for every debit card transaction? Because they are going to get huge fees from the merchants who accept them. No business that went cash only would survive for long. This generation has little conception of moving money without using plastic as the conveyance. It's breaking the backs of small businesses. So some try to lift the burden by offering a discount for cash. Some set a minimum purchase limit. If the consumer was charged the processing fee instead of the merchant, credit card and especially debit card use, would come to a grinding halt. Have I spelled it out enough for ya?
Hell, I thought it was standard practice today to pay first before pumping, due to the drive-aways since the price went sky-high.
Commerce is confusing to the consumer who is always right.
In our current economy debit/credit cards are the standard and thus businesses are forced to accept them to compete. The fee, generally 2%, is a cost of doing business to fully serve your patrons. Now, they are trying to recover that cost directly through price changes.
This is not surprising given the Visa/MC add that make using a check or cash an evil thing. You have seen the adds, everyone is cruising around - speed of commerce with their credit cards, and the customer with cash or a check stops the frenzy -- they all give him the stink eye, and he crawls away in shame. CASH IS NO GOOD HERE.
I don't like it, but as long as its shown on the marque - I understand it. Additionally, there is a marketing benefit to you walking into the stop and rob, you might buy a bottle of water, soda, candy bar other item, you would not otherwise when paying at the pump.
The recent BP shooting makes it even more less likely I will go inside, 3-4 cent increase in price be damned. I do like the gift card idea though, thanks Mom2.
TAHL
posted by TheAssHoleLawyer on Aug 18, 2008 at 08:18:49 am #
Here's an idea. Don't get your gas at those stations. I've noticed the cash/ credit pricing difference at some local BP stations. Guess what? I don't go there any longer.
Here's an example of consumers having a voice. There are two stations at the Monroe/ Douglas intersection. One is BP and the other, I believe, is a Sunoco. This BP had the different pricing for some time. I went in there last night for a drink and noticed their pricing is back to normal. I asked the attendant why? Her reply was "the station across the street didn't charge for using plastic".
That Sunoco seemed to always charge what the BP "cash" option was.
@holland: I understand why they are doing it, to save their cost. I really do understand that. I think you over analyzed what I said and took it into another direction. Everyone keeps saying merchants... I am only talking about gas stations here as I have yet to see other merchants offering discounts to cash paying consumers.
@TheAssHoleLawyer: I agree with you & the idea by Mom2 was great.
Perhaps these merchants need to talk to their gas suppliers. It's hard to believe that gas stations aren't making profits & I guess that's been my whole point here.
Stations don’t really make any money on the sale of gas. It is all about the extras like cigs and candy and beer, etc that pay their bills. That is why you never just see a station that sells only gas.
Thank you Ryan... That's what I was looking for. Why don't the gas stations talk to their gas suppliers then considering they are posting HUGE profits?!
I assume it is because the supplier would probably laugh in their face. They are at the mercy of Mobil, etc. It is another legal monopoly in my eyes.
What don't you get? Discounts for paying with cash have been around as long as credit cards with a bunch of different vendor types. That is why some will not accept cards unles the purchase is over 5 bucks or whatever. I am surprised more don't offer that discount.
posted by Ryan on Aug 17, 2008 at 05:59:19 pm #