Return of cash vs credit gas prices

[madbrian]

Posted: 6/10/08 at 1:09pm

Here in NJ, I'm starting to see some gas stations returning to the old practice of lower prices for cash purchases. Of course, they only put their cash price on their roadside signs. So, be careful that the price you're paying at the pump is what you're expecting.

[Calvin]

Posted: 6/10/08 at 1:36pm

As I said in another thread, they are treading some slippery ground in terms of their card network agreements. While it is kosher to offer a discount for cash payment, it is not acceptable to tack a surcharge onto credit card purchases (if they accept Visa and/or MasterCard, that is -- and who doesn't?).

The fact that they're advertising discounted prices as standard prices might be problematic for them.

[Unknown User]

Posted: 6/10/08 at 1:49pm

Credit card processing fees charge the station between 1.25% and 2% of each transaction. Gas stations typically only markup gas prices by 2-10 cents per gallon. (Not percentage). So if gas is $4 a gallon your station might be making only .5 to 2% on each gallon sold while paying the same (or more) to a credit card company.

My local gas station manager told me that he's taking in way more money than ever-- but is actually losing money. It seems his convenience store business is WAY down as people who've just spent $50 on gas are unlikely to go in and buy a Diet Coke. And, as he pointed out to me, he would make more profit off my $1.39 Diet Coke than he would my $20 of gas.

[Calvin]

Posted: 6/10/08 at 1:57pm

Yes, I understand that, and that's an ongoing issue between the networks, the banks and the vendors. But -- it is deceptive to advertise a discounted price without noting somewhere that it is a discount price. Especially in a state like New Jersey, where you're not pumping your own gas and might not realize what you're paying until the card's already been swiped.

In order to comply with card network terms, the credit card price has to be the price registered at the pump itself, with the discount taken off that price -- otherwise, it's a violation of their agreement to accept that card and, in some states, is illegal.
Updated On: 6/10/08 at 01:57 PM

[adamgreer]

Posted: 6/10/08 at 5:28pm

I refuse to purchase gas from stations that are changing an additional amount of money for credit/debit purchases (typically an extra .10 a gallon). They never did this when the gas was cheaper, and it's ridiculous that they're going to start doing it now.

[Unknown User]

Posted: 6/10/08 at 5:48pm

Adam did you read what I posted? When gas was $3 a gallon, they were making a 3% profit so they could pay the Credit card cut and still make a percentage (more or less). Now, after paying the credit card companies, the station would be LOSING money on every gallon they sold. They might as well close- or not take credit cards at all.

[violet72]

Posted: 6/11/08 at 10:03am

The WaWa near me (it's an awesome convenience store and so much more) is charging $4.01 for credit and $3.61 for cash. Thats a 40 cent difference which to me is ridiculous...10 cent difference is fine, but 40??? I just have them fill it and run in and get money out of the ATM...the first year that I was driving(1994) it was way under $1.50....this is ridiculous

[romantico]

Posted: 6/11/08 at 10:06am

I always pay for my gas with a debit card and I have been told I should not do that. Its so much easier paying at the pump, but I may start just paying out cash for my gas.

[Jon]

Posted: 6/11/08 at 11:57am

There is a gas station in the Chicago area that actually has stopped selling gas. They still are open to sell food and cigarettes. The mark-up on gas is so small that whenever someone bought gas with a credit card, the station actually lost money due to the service fee.