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Gas Q & A

Why are gas station merchants assessing a surcharge on purchases made with a credit card?

We believe they are doing this to recoup some of their business costs that are associated with the fee they pay for credit card transactions.

Does Discover Card allow merchants to assess a surcharge?

Discover Card does not prohibit merchants from assessing a surcharge on credit card purchases, provided that the merchant also assesses a surcharge on purchases made with other card brands such as Visa and MasterCard. In other words, the merchant must treat all credit card transactions equally.

How much is the surcharge?

The surcharge fee that a merchant elects to charge may vary and cannot exceed the transaction fee that the merchant is contractually obligated to pay to process a credit card transaction.

Who sets the surcharge fee amount?

The merchant sets the surcharge fee, which cannot amount to more than the transaction fee that the merchant is contractually obligated to pay to process a credit card transaction.

How are gas stations communicating surcharges to consumers?

Some are posting signs at the pump, but requirements for signage and communication of prices will vary by state or local law.

Speaking of signage, I recently saw a sign from the National Association of Convenience Stores (NACS) above the pump. What's that about?

The NACS is concerned about the credit card fees convenience stores have to pay for gasoline purchases. These interchange fees are a fixed percentage of the total gasoline purchase, so as the price of gasoline rises, so do the fees.

What can consumers do if they do not want to pay the credit card surcharge?

We believe that consumers should pay for gas in a manner that is most convenient for them, whether it be with cash or with credit. This may mean they need to shop around for the gas station that best fits their needs. To avoid any confusion, we recommend that consumers verify the price that they are paying at the pump - as well as whether or not credit cards are accepted at a particular gas station - before dispensing gasoline.

How can consumers find out if their particular gas station is charging a surcharge for credit cards, or not accepting credit cards at all?

For questions or concerns about a specific merchant's operating practices, consumers should contact the merchant directly, or contact their local Better Business Bureau.

My gas station no longer accepts credit cards for gas purchases. Do merchants have to accept credit cards?

No. Merchants have the option to accept or not accept credit cards for payment.

Why would a merchant stop accepting credit cards for gas purchases?

We can't speak for merchants, but what we can say is that credit cards are an integral part of our economy and consumers rely on them as a convenient, and often a necessary, form of payment.

Why is there a purchase limit when I buy gas at the pump?

As part of their fraud prevention programs, gas merchants may set dollar limits for purchases at customer-activated pumps when payment cards are used. These limits often correspond to fraud protection limits granted by Discover Network and other card companies. In most circumstances, Discover Network generally protects gas merchants up to $75 for pay-at-the-pump transactions, increased from $50 last year.

What is a hold charge?

A hold charge is when a merchant requests a certain amount of credit to be placed on hold until a credit card transaction is processed and approved. Hold charges are common at hotels, car rental companies and gas stations. Because a majority of gas stations use pay-at-the-pump as a payment method, the gas transaction may not be processed for a couple of days. The hold charge requested by the merchant will remain on the account until the actual charges have been approved.

What can I do to avoid hold charges?

Once you have done business with the merchant (i.e. hotel, restaurant, gas station), you can ask the merchant to contact your credit card company to have the hold charge removed if it still appears on your credit card after a few days. To avoid hold charges, you can pay in advance (hotels, car rentals) or pay at the register (gas stations).

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