About 60% of consumers knew that merchants have to pay credit card companies a fee to process each transaction: their average estimate of the amount the merchant pays was 2.66%, with the most putting it between 1% and 2%, which is relatively accurate. Cardbeat surveyed 408 credit card holders in July 2010.
On the other hand, respondents tended to overestimate the importance of merchant fees: on average, they guessed that 41% of the money that credit card companies make comes from merchants. In a standard credit card portfolio, the contribution of interchange is usually less than 25%, she said.
When asked about whether it is appropriate for merchants to charge less to customers who pay with cash, only 20% voiced opposition, while 42% were neutral and 38% approved of the idea. Heavy credit card users and holders of rewards cards were no more likely than the overall population to oppose the idea of differential pricing, according to the study.
The payments industry has battled the practice of two-tier pricing at gas stations. But consumers don't trust merchants to pass along any potential savings they may incur due to proposed laws. When respondents were asked how merchants would respond if Congress passed a law that reduced or capped the amount of merchant fees, only 14% thought it was likely that they would pass along the savings to customers by reducing pricing. --Tanya Irwin