Price inflation is rising at its fastest rate since the early 1980s, and that’s prompting dueling releases from both foes and advocates of card interchange, the fee merchants pay when consumers use credit and debit cards.
Merchant groups have long inveighed against interchange—also referred to as “swipe fees”—as a cost burden for sellers that accept cards, but 8% inflation has handed them a fresh argument. The Merchants Payments Coalition on Wednesday issued a release contending that interchange fees “drive up prices [merchants] charge consumers,” exacerbating the impact of inflation. Interchange, the Washington, D.C.-based group argues, represents merchants’ second-highest operating expense, after labor.
All told, swipe fees on purchases made with credit and debit cards last year totaled $137.8 billion in the United States, up 25% in one year, according to the MPC.