RUCKERSVILLE — Managers at the Tiger Fuel gas station and convenience store near the foothills of the Blue Ridge Mountains expect to pay more in credit card processing fees this year than they will on rent. The company, which operates in Ruckersville, Virginia, is among many small retailers grappling with rising swipe fees that now represent a large portion of operating costs.
Credit card fees can be as high as 5% for some premium cards offering luxury perks and hefty rewards. Total credit and debit card fees paid by U.S. merchants to processors like Visa and Mastercard rose 70% since 2019, reaching $198 billion in 2025, according to the Nilson Report. The increase stems from higher consumer spending, declining cash use, and growing fees tied to rewards programs.
“It’s tougher for us to stay afloat, tougher for us to make money at our stores. It makes it harder for us to keep our prices low,” said Maurice Lamarche, vice president of retail operations for Tiger Fuel Co.
Customers who pay with cash, debit cards, or non-rewards credit cards face higher prices without receiving any benefits, while rewards card users often recoup most of the added cost through cash back, travel points, or other perks. A 2025 Harvard Business School study estimated this dynamic results in a $30 billion annual wealth transfer from cash and debit users—disproportionately lower- and middle-income households—to credit card users, who are more likely to be higher-income.
“From the credit card user’s perspective, they have to pay a higher price, but they’re going to get most of that higher fee the merchant pays back in the form of rewards, so in some cases they come out ahead. If I pay with cash, I pay a higher price, but I don’t get any rewards, so I’m going to be hurt by that,” said Mark Egan, a professor at Harvard Business School and author of the study.
The Electronic Payments Coalition, which represents card networks, disputed the Harvard findings, saying the analysis “rests on a set of faulty assumptions that bias these estimates upwards.” The group also noted that cash imposes its own costs on businesses, including security, transportation, and banking fees. “Cash isn’t free for small businesses. That is why businesses are going cashless — not the opposite.”
The National Retail Federation estimates swipe fees add more than $1,200 per year to household expenses.