Credit Card 'Swipe' Fees Could Cost Shoppers Over $20 Billion This Holiday Season

If shopping for the holidays seems more expensive this year, blame credit card "swipe fees." This is what credit card companies charge stores when you use credit cards — and you can bet that fee gets passed down to you in higher prices. 

Swipe fees are higher in the U.S. than other countries, so you could pay more for an item than shoppers in Great Britain, France, or China.

What will you end up paying in higher prices? Based on the average 2.26% rate for Visa and Mastercard, that would wind up being just over $20 for the average family. So yes, that could buy you a Barbie or a turkey for your holiday meal.

If you think swipe fees dropped with inflation, guess again. Last year they were $18.6 billion. Since 85% of holiday purchases will be made with credit or debit cards, that small amount of cash purchases helps (a little). If all purchases were made with cards, swipe fees would total $27.7 billion, up from $26 billion. 

Swipe fees are most merchants’ highest operating cost after labor, year round.

Yes, they've gone up since last year, but swipe fees are up 50 percent since the pandemic. They hit $172 billion last year, a record high.

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