We have three or four low-priced gas stations in our small town. That is, low-priced for the bay area. Almost every one has some variation on the debit/credit/cash price shuffle: it’s 10 cents extra per gallon if you pay with debit or credit vs. cash. Isn’t using a debit card pretty much the same as a cash transaction?
In addition to that, a couple of them add that extra fee of about .35 for debit/credit transactions, which fee is revealed only after you’ve run your card and selected your gas. This fee is not discussed on the price board or the pump.
Of our gas stations only one pulls neither of these two stunts: a newly-opened 7-Eleven. And their price is almost as low as the cash price of the lowest-priced station.
There used to be a station here that has FOUR grades of gas:
Economy 86
Regular 87
Mid 89
Premium 91
The big sign would show the Economy price. It was “full service” so you did not fill your own gas.
People would come in and the pump jockey would ask “fill up on regular?” to which most people would reply “yes” without checking the prices on the pump and proffer a debit/credit card. BOOM, you just bought gas for 70c a gallon more than the posted price. The prices would be something like:
Economy 2.29
Regular 2.99
Mid 3.19
Premium 3.49
They are no longer in business and the state federal and local governments have been fighting over who needs to clean up the pollution at that site for over ten years.
Used to be a flat fee per transaction, it’s now a flat fee plus a percentage. It was never ‘free’ like cash is (‘free’ because cash has it’s own expenses).
The Sacramento area is pretty much the same. Although there are some stations that will charge you the cash price if you use a debit card, and select the debit option at the pump. And others that don’t even have a debit option and will simply process your debit card as a credit transaction and charge you the higher price. Which you don’t find out about until you’ve already swiped your debit card.
In SW Orlando near both the entrance to Disney World and the airport is a gas station which charges (as of a recent review) $7.99 per gallon for regular. They are counting on people who are in a hurry to top off their rental cars and who don’t bother to look at the pump price first-as well as foreign tourists who can’t do a quick set of conversions in their head. They used to be a Shell franchisee but my guess is that Shell canceled their license, so they just went independent (and jerked the price even higher from the $5.99 it used to be). Tons of reviews on both Google and Yelp from people who only noticed that they just got ripped off after they had filled their tanks. Marquee price is small and low and thus not readily visible.
Down the street from me is an Exxon that right now is $3.50 or so, which is a bit expensive around me. Go down the road a mile and gas is $4.80! There’s no reason for it to be that expensive as it’s not next to the highway or anything. It’s always at least a buck more expensive than any other place around.
I’m pretty sure that in the UK, it’s been illegal for some time now to charge different prices depending on the method of payment, nor can retailers add a fee for card services. I think it’s still legal for retailers to stipulate a (reasonable) minimum spend below which they will only accept cash payment (£5 is common, but even that is quickly dying out because contactless card payment is now almost ubiquitous for small purchases, including things like vending machines).
I usually ask small businesses if they would prefer I pay by cash or card. By far the most common response is they don’t care - they get charged a fee for card payments, but they also get charged a fee by their bank for handling cash, so it seems to be a wash for them. I believe the vast majority of purchases in the UK are made by (debit or credit) card, and that percentage is continually increasing.