While many Americans worry about tariffs potentially boosting inflation, merchants continue to warn of a cost increase that’s already certain: credit card swipe fees.
Banks, card processors and processing networks like Visa and Mastercard each charge a fee to process credit card transactions. The sum of those fees is called the “swipe fee,” which usually amounts to between 1% and 3% of the sale. Visa and Mastercard, which control about 80% of credit card processing, skipped fee increases in 2020 because of the pandemic and in 2021 under pressure from Congress. In 2022, they resumed hiking fees. In January, Visa plans to boost some of the fees it charges merchants and banks, according to a notice from the processor Global Payments.
Swipe fees are often merchants’ second largest expense after labor and eventually get passed down to consumers, experts said. They already cost the average household more than $1,100 annually, up from $900 in 2021, and will continue to climb unless Congress acts, according to the National Retail Federation. While consumer prices have risen about 20% since the pandemic, swipe fees have increased by 50% and hit a record $172 billion in 2023, the Merchant Payments Coalition estimates.
“Inflation is coming down, but swipe fees keep going up, taking a bigger slice out of what it takes to put presents under the tree,” said Stephanie Martz, MPC executive committee member and NRF chief administrative officer and general counsel, in a statement…
