TULSA, Okla. — Nearly two-thirds of credit card holders have been hit with extra fees just for using their card to pay and most people think these charges should be illegal according to a new study.
A LendingTree survey of 2,000 consumers found 62% of cardholders have paid surcharges to use their credit card at retailers or other merchants.
One-third of those people say they weren't warned about the fee before paying which is required under the rules allowing the fees to be passed on to customers in states where such fees are allowed.
Matt Schulz is a credit card analyst with LendingTree.
"What's happening is that it costs money for merchants to be able to accept credit cards, and a lot of merchants are passing on the cost of that acceptance to consumers in the form of a fee on top of the price of the item that they're buying."
Those fees merchants pay range from 1.5% to 3.5% of each transaction, which can be significant money for businesses with tight profit margins. Merchants are not allowed to charge fees that would give them a profit.
56% of cardholders say it should be illegal for retailers to charge extra for using a credit card. 86% say businesses should disclose credit card surcharges up front.
"Merchants absolutely should be transparent about any fees that they're going to charge people, but the truth is that it doesn't always work out that way."
The survey reveals:
- Nearly half of cardholders don’t know that card companies make money from swipe fees.
- Over half of cardholders (56%) say it should be illegal for retailers to charge extra for using a credit card. That includes 70% of baby boomers and 64% of women.
- The majority of cardholders (86%) say businesses should disclose credit card surcharges up front. However, 84% would rather have merchants offer a discount for paying in cash instead of adding a surcharge.
- If merchants charged an extra fee every time customers used a credit card, 65% of cardholders say they wouldn’t use the card as much as they currently do.
If you're hit with an unexpected surcharge, Schulz says you can:
- Complain to your credit card company
- Complain to credit card networks
- Complain to the store's corporate headquarters
- Oklahoma Attorney General’s Office Consumer Protection Unit
The survey also found that if merchants charged fees every time, 65% of cardholders say they wouldn't use their card as much.
This story was reported on-air by a journalist and has been converted to this platform with the assistance of AI. Our editorial team verifies all reporting on all platforms for fairness and accuracy.
Stay in touch with us anytime, anywhere --
- Download our free app for Apple, Android and Kindle devices.
- Sign up for daily newsletters emailed to you
- Like us on Facebook
- Follow us on Instagram
- Watch LIVE 24/7 on YouTube
