Gas prices get higher when credit is involved

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Gas prices get higher when credit is involved

By JASON RYAN<br>The Beaufort Gazette
Published Saturday, January 21, 2006 in The Island Packet  |  842 Words  |  /BeaufortGazette/local_news

People pumping gas need to look beyond the octane levels and read the small print regarding prices as at least one Beaufort gas station is charging more to customers who swipe their credit or debit cards when paying for their fuel.'
In an effort to avoid credit and debit card fees, the Enmark station on Boundary Street began offering after Christmas a price difference of 3 cents per gallon for those who pay with cash or check instead of plastic, said David Wuensch, store manager.'
A survey of gas stations in Beaufort, Port Royal and on Lady's Island showed no other gas stations had similar policies.'
Other gas stations in the Carolinas started offering cheaper prices to customers who use cash this year as well, including gas stations in Bluffton, Myrtle Beach and Charlotte, said Tom Crosby, a Charlotte-based spokesman for travel service AAA Carolinas.'
"We're seeing more of it all the time," he said. "They're allowing you to save what they would pay for the credit card fee. It's a good deal for the customer."'
There are about 70 Enmark stations in South Carolina, North Carolina and Georgia, according to the Web site of parent company The Colonial Group of Savannah, which refused to answer questions this week.'
David Roberston, publisher of payment car industry newsletter The Nilson Report, said such business tactics are not unheard of as businesses tire of paying a portion of their sales to credit card companies.'
"It has always existed as retailers try to get back what they think they should not pay," he said.'
In 2005, retailers typically paid a fee of 2.05 percent of sales paid for with credit cards and 1.5 percent of sales paid for with debit cards, Robertson said.'
So to avoid those costs, Enmark encourages customers to pay with cash or check, Wuensch explained.'
Wuensch said that when customers find out about the policy at his station on Boundary Street, they sometimes complain and they sometimes write a check instead of using a card, but they still pay.'
In an effort to prevent discrimination, Visa USA and other major credit card companies have contractual policies with retailers that forbid charging card-carrying customers extra, said Rhonda Bentz, vice president of public affairs of Visa USA.'
"Some merchants are trying to shift their costs of business onto cardholders and that's why we have this rule," said Bentz, who said fines could be imposed if a company violates the rule. "You have to offer the cardholder the advertised price, nothing higher."'
In Florida and Texas, Bentz said, laws prevent retailers from charging extra, though none exist for South Carolina, North Carolina and Georgia.'
But Bentz said that while retailers cannot charge more than an advertised price without violating Visa USA's policy, retailers can offer a discount to those who pay cash.'
"It's all about the advertised price," she said, conceding that either way, the result is a difference in price depending on method of payment.'
And the difference between a surcharge and a discount can often be in the eye of the beholder.'
The Enmark sign on Boundary Street advertised $2.17 a gallon Friday morning if cash is used to pay for regular, unleaded gasoline. In smaller print on one side of the sign is a notice that credit card customers must pay $2.20.'
Signs on some of the pumps phrase it a bit differently, advertising the higher price and saying cash-paying customers get a 3 cent per gallon discount.'
Regardless of the semantics, surcharge or discount, many customers are unaware there's a difference, and some aren't happy about it.'
"I have to pay more just to use my card instead of going up there and handing them the money," said 60-year-old Rose Grant, pointing to the payment window a few yards away.'
Grant had just purchased 14 gallons of gas and said that next time she would likely fill up elsewhere.'
Tracey Mills, a spokeswoman for the American Bankers Association, said customers using credit cards tend to spend more money and are not restricted to cash in their pocket. At a gas station, this means someone is more likely to fill their entire tank.'
But Wuensch was confident other gas stations would "jump on the wagon" as they tire of costs from credit and debit cards.'
Kevin Peeples, owner of Boundary Street Sea Store, saidEnmark's fee-avoiding policy was a good one, though he is waiting to see customers' reactions before he decides to use it at his Exxon station.'
"Some people don't pay any attention. People are creatures of habit and go to the same place all the time," Peeples said, anticipating some reaction when more Enmark customers start noticing the policy.'
"Those people will either start paying with cash or start going somewhere else," he said.