Rising credit card swipe fees cost merchants $198 billion annually, driving up prices for cash-paying shoppers
By
Shannon Pettypiece
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Summary
Credit card processing fees paid by merchants have surged 70% since 2019 to $198 billion in 2025, driven by increased consumer spending, declining cash usage, and higher fees that fund credit card rewards programs. A Harvard study estimates cash and debit card users subsidize $30 billion annually in perks for credit card users. The article examines how high-end credit card perks and rewards programs are ultimately hurting lower-income shoppers who pay with cash or debit, as merchants raise prices across the board to cover rising swipe fees.
Key quotes
· 3 pulledMaurice Lamarche, vice president of retail operations at Tiger Fuel Co., said credit card fees are the biggest expense in the Ruckersville, Va., store.
The total credit and debit card fees paid by merchants to card processors, led by Visa and Mastercard, have increased 70% since 2019 to $198 billion in 2025, according to data from the Nilson Report.
A Harvard study estimates that people who pay with cash and debit cards are subsidizing $30 billion a year in points and perks for credit card users.
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