It is a sight seen more frequently in gas stations around the country: signs promising consumers a discount if they pay for fuel in cash instead of with their credit cards.
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Credit card companies understandably don't like it, but some gas station owners have been attempting to circumvent the interchange fees that they pay on every purchase by telling customers that they can get cheaper gas if they put away the plastic.
Unfortunately for the gas station companies, not all of the customers like the idea either. The Times Herald-Record, the newspaper for New York's Hudson Valley and the Catskills, reported recently about gas stations in the area advertising cheaper gas for cash, which has apparently been met with mixed success. Obviously the customers in the area who have used cash aren't complaining--I sure wouldn't if I had the foresight to bring some of the green stuff along and use it to get cheaper gas--but consumers who use credit cards regularly to purchase fuel aren't happy.
Now one could say, "Tough; just pay in cash," but consumers especially haven't been pleased when the signs at gas stations aren't posted well. For instance, some people went to one gas station cited in the Herald-Record story, thinking they were going to get gas for $3.84 a gallon, only to realize once they were on the lot that with their credit card, they would actually be paying $3.92.
Another gas station in the area started putting out a sign indicating that they were charging the same for cash as credit, due to realizing that some locals were getting frustrated by the bait-and-switch.
Which is why, on August 10, the State Board of Agriculture in North Carolina came down with a law, which hasn't been officially approved yet, mandating that the state's gas stations must have clearer labeling if they're offering a cheaper price to cash-wielding consumers. It's been a problem in the state--and in many states--for some time now with gas prices climbing in the last several years and gas station owners trying to squeeze out more profit in what can be a somewhat unprofitable industry. When you're a gas station owner, you may make more money on the bag of chips that a motorist purchases if they come into the store, than on the gas that is purchased at the fuel pump.
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Still, gas station owners aren't doing themselves any favors when they don't label their prices clearly and wind up annoying their customers. I know I'm pretty peeved, upon returning from a week-long vacation. The morning I was driving back from my vacation, I checked my account from my computer and found it much more anemic than I had budgeted for, and was pretty alarmed. I couldn't see where I had gone wrong and came home, figuring that I'd figure it out later.
However, the day after returning from my trip, I suddenly had $500 more than I thought I had. It took me awhile before remembering that some gas stations will put a "hold" on credit cards and especially debit cards--allowing you to spend, say, $40 on gas but actually blocking out $100. And so I'm pretty sure, having spent a small fortune on gas, that that's what happened to me.
Of course, gas stations don't just blow it there. Two stations near the Orlando International Airport, Sun Gas and Suncoast Energys, are notorious for not posting their prices and then charging the highest prices of gas in the country and then roping in rental car owners who fuel up before returning their car. And so I'm thinking that between the occasional stations that do business unethically and the stations that put up misleading signs and hold funds, that there's probably an opening here for gas credit cards to offer even more perks and rewards to attract consumers. I know I'm thinking of getting one after my trip and seeing if I have a better experience on my next vacation. Not that car driving customers are going anywhere, but if gas stations don't make it easier for their patrons to pay, they just may send more of them down the road.
I never thought I'd say this with their security lines and baggage fees, but suddenly the airlines are suddenly looking better and better.
The original article can be found at CardRatings.com:
Like fire on gasoline, sometimes credit cards and gas stations don't mix well.