Inflated Pricing for All Consumers

Merchants that accept credit cards must pay interchange fees and discount fees on all credit-card transactions.^[4] However, merchants are usually barred by their credit agreements from passing these fees directly to the credit card customers, or from setting a minimum transaction amount.^[5] The result, at least in the United States, is that even consumers that do not use credit cards experience higher prices from most merchants to cover the hidden transaction fees afforded for credit cards.^[6] In the United States in 2008, credit card companies collected a total of $48 billion in interchange fees, or an average of $427 per family, with an average fee rate of about 2% per transaction.^[7] Since these fees can't be passed directly to credit card customers, they become a hidden part of the prices offered by any merchant to all of its customers.