Visa’s plan to raise small-ticket fees will hurt merchants

Visa’s recent announcement that it will impose the highest fees allowed on all debit transactions is expected to hit smaller retailers hard.

The plan includes imposing the highest fees on even the so-called small-ticket purchases for cards issued by some of the largest U.S. banks, according to

Visa passes the fees to companies such as JPMorgan Chase and Citigroup and currently charges merchants 1.55 percent of each purchase in addition to four cents for small-ticket transactions that cost less than $15.

The Federal Reserve recently capped the fees for all debit card swipes to 21 cents. Visa’s plan to charge merchants that amount on small purchases will hurt smaller retailers.

"The mom-and-pop coffee shop that processes lots of three dollar transactions is really going to get hurt by this," Brian Dodge, a spokesman for the Retail Industry Leaders Association, said, according to

Approximately 20 percent of debit card purchases are small-ticket.

"There are unintended consequences that result when the government steps in and pretends to know better than the free market," Trish Wexler, a spokeswoman for the Electronic Payments Coalition, said, according to KCChronicle.

Wexler said that Visa has customers on the bank side so it has to make sure its issuers are happy, and on the other side, it has to make sure that retailers aren't getting charged too much.

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