Search
Close this search box.
Search
Close this search box.

What You Need to Know About What Credit Card Swipe Fees are Doing to Your Wallet?

Credit Card Swipe Fees

Credit card swipe fees are a major cost for consumers many don’t know about, costing you hundreds more than anticipated. It’s gotten so bad that many are looking for the best online personal loans to help to reduce the hit their budgets have taken thanks to these hidden fees. Here is what you need to know about these fees and how they affect your wallet.

What are swipe fees?

Swipe fees are a fee charged by banks when a consumer swipes their card using a POS (Point of Sale) terminal. These fees can be as high as 2% of the total amount transferred and vary based on the credit card company. American Express typically charges the highest rate in swipe fees, while Visa and Mastercard are usually the lowest.

Why do swipe fees exist?

The main reason banks charge swipe fees is to cover the cost of processing the transaction. This includes the bank’s costs (Chase-issued Visa cards, for example) and those of the credit card company (Visa, in this case). To compete, each card company has set rates that it believes are reasonable and necessary to cover expenses incurred to help you buy the things you want by using your credit card.

In addition, many of those fees go toward the membership perks of owning the card. American Express, for example, offers premier perks such as airport lounge access and complimentary top-tier membership levels to partnering hotels, airlines, and cruises. These perks cost money, so Amex partially subsidizes these through swipe fees charged to merchants.

How do swipe fees affect me?

You’ll rarely see these fees on your receipt since retailers are charged the fee directly instead of the consumer. However, that doesn’t mean you’re still not paying those fees; many retailers simply add the charges they pay to the final product or service cost.
Significant swipe fee hikes in recent years have had a major impact on consumers’ wallets. A study by CompareCards found that the average American household pays $103 per year in swipe fees, totaling $24 billion annually.

What can I do to reduce the costs caused by swipe fees?

The good news is that there are ways to reduce your exposure to swipe fees.
● Use a debit card if possible since they don’t typically have swipe fees.
● Compare rates before making a purchase to avoid paying high swipe fees.
● Use cash instead of plastic when possible to avoid paying those pesky swipe fees. Many vendors will offer cash buyers a discount, so ask first before purchasing.
● Monitor your bank account regularly to ensure you’re not spending more than you can afford to pay in swipe fees.
● Try shopping in person instead of online. Online retailers don’t have the ability to offer cash discounts, while many brick-and-mortar stores do.
Credit cards without swipe fees can help you save money on expenses and keep more of what you earn. Make sure to research available offers to get the best deal for your needs.

The bottom line

Swipe fees might be hurting your wallet, but there are things you can do to avoid paying more than you should. By following the tips in this article, you can save hundreds of dollars on your next shopping trip.


Subscribe to Our Newsletter

Related Articles

Top Trending

Man splits cocaine into strips and then snorts. Narcotics concept.
Cocaine Vaccine: A New Hope for Addiction Recovery?
Lowest Salary Earners in the World
World's Lowest Salary Countries: Nigeria and Egypt Spotlighted
Most Healthiest Countries in the World
30 Most Healthiest Countries in the World: Why they Are Healthy? [2024 Updated]
Personal Injury Incident
Understanding Your Rights: What To Do After A Personal Injury Incident?
woman hairdresser in modern beauty salon with hairbrush and client.
Wave Goodbye to Hair Loss: Hair Loss Treatment for Women

LIFESTYLE

Most Healthiest Countries in the World
30 Most Healthiest Countries in the World: Why they Are Healthy? [2024 Updated]
Tips to Help You Find Confidence
Five Quick Tips to Help You Find Confidence
Top Countries Where Weddings Cost a Fortune
Top Countries Where Weddings Cost a Fortune: A Global Ranking
Why Finland world Happiest Country
Unveiling the Secrets: Why Finland is the World's Happiest Country?
paul giamatti weight loss
The Ultimate Guide to Paul Giamatti's Impressive Weight Loss Journey

Entertainment

Female Pokemon Characters
A Complete List of 30 Top Female Pokemon Characters in the Universe
Disney Plus Hulu Merge Streaming Service
Disney Plus & Hulu Merger: More Than Just a Streaming Bundle
Elden Ring Endings Explained
Elden Ring Endings Explained: A Comprehensive Guide in 2024
meteorite staff elden ring location
Ultimate Guide to Finding the Meteorite Staff Location in Elden Ring
did joni lamb remarry
Did Joni Lamb Remarry According to Biblical Principles?

GAMING

Elden Ring Endings Explained
Elden Ring Endings Explained: A Comprehensive Guide in 2024
meteorite staff elden ring location
Ultimate Guide to Finding the Meteorite Staff Location in Elden Ring
isolated divine tower elden ring
How to Solve the Mystery of the Isolated Divine Tower Elden Ring
Casino Books to Keep You Hooked
Casino Books to Keep You Hooked!
AI for Competitive Advantage in iGaming
Leveraging AI for Competitive Advantage in iGaming

BUSINESS

bill gates india global advancement
Bill Gates Highlights India as Crucial to Worldwide Advancement
Rafaela Nonnenmacher Bundchen
Rafaela Nonnenmacher Bündchen: The Youngest of Gisele Bündchen's Siblings
Chiefs Owner Net Worth
Chiefs Owner Net Worth Breakdown in 2024 [Latest Update]
Bitcoin Holding Despite Low Activity
Bitcoin's Standstill: Low On-Chain Activity Yet No Rush to Sell, Says Analyst
Reddit AI User Data Stock Soar
Unlocking Reddit's Success: How AI Data Boosted Its Stock?

TECHNOLOGY

How Many Wheels Are There in the World
How Many Wheels Are There in the World? The Ultimate Investigation
Ideas for QR Codes
Creative Design Ideas for QR Codes
Saudi-Owned Moroccan Plant's $47M Breakdown
Solar Power Setback: Saudi-Owned Moroccan Plant's $47M Breakdown
Building Blocks
Exploring Multichain Future: The New Era of Blockchain Building Blocks
Apple Partners with Baidu for AI Solutions
Apple Partners with Baidu for AI Solutions: Inside the Tech Giant's Move

HEALTH

Man splits cocaine into strips and then snorts. Narcotics concept.
Cocaine Vaccine: A New Hope for Addiction Recovery?
Most Healthiest Countries in the World
30 Most Healthiest Countries in the World: Why they Are Healthy? [2024 Updated]
woman hairdresser in modern beauty salon with hairbrush and client.
Wave Goodbye to Hair Loss: Hair Loss Treatment for Women
Top Vegetarian Destinations
Top Veggie Paradises: Discover the World's Best Vegetarian Destinations
brandon and mary
The Misconceptions Surrounding Brandon and Mary's Health Announcement