Retailers say hidden credit card fees/interchange fees are costing consumers

TAMPA BAY, Florida - You may not always notice them, but more and more retailers around the area - often gas stations or convenience stories - are posting signs that could stop you from swiping your card. 

Store owners say they post a "$5 minimum for credit" sign to protect themselves from the high "swipe fees" they pay every time they swipe a card.  The fees often cost more than the retailer will make on a small sale.

The only problem is that transaction minimums are prohibited by the credit card companies because they say it encourages consumers to spend more at the checkout counter.

"The fees can be enormous to a shop owner," said credit specialist Laurie Zoock.  "They don't want you to make small purchases with a credit card."

But the national battle over the swipe fees - or interchange fees - has been going on for years.  It even spilled into Tallahassee this year.

Retailers say the different fees they're charged are hidden fees that wind up getting passed down to consumers.  The credit card companies say it's a reasonable cost for the security and convenience of their service.

"Retailers receive tremendous benefits from accepting electronic payments," said VISA in a statement.  "In a recent survey...by a 2-to-1 margin, consumers said retailers should pay the cost of accepting credit and debit cards."

The National Retail Federation (NRF) says the average U.S. household now pays more than $400 a year in interchange fees passed down from retailers.

"It's probably the largest fee consumers have never heard of," said Mallory Duncan with the NRF.  "Last year, many merchants discovered the credit card companies were making more money off their business than the merchant was."

"The fees are enormous," said St. Petersburg business owner Liz Armas.  "It's like having another rent."

Armas said she doesn't pass the fees on to customers of her business, Beautiful Clothes by Liz.  But the credit card companies continue to pile more and more interchange fees onto her monthly statement and she has no choice but to pay them.

Retailers say they often pay 2-3 percent of every sale to the credit card companies, plus additional fees that can accumulate fast if the sales are small.  Small business owners complain that they don't have the leverage to negotiate good credit card contracts like bigger retailers do.

"In a plastic world," Armas added, "if you don't take a card, you will lose the sales."

You can read hundreds of interesting statistics about credit card use in the United States here.

Follow 10 Connects reporter Noah Pransky on Twitter at www.twitter.com/noahpransky or Facebook at www.facebook.com/noahpransky.