[bombcar]

Does anyone know if the "real big" merchants like Walmart have to pay the fee? I assume they're so large they can sit on the processors and squeeze them (I know Costco does, they pay 0% fees in-store because Visa is so hungry to be their processor).

[jedberg]

Based on this article it sounds like they pay enough to want a law to make it less:

https://www.cnn.com/2022/09/20/business/credit-card-fees-vis...

Costco gets away with 0% because they offer exclusivity and because they cover some of the cost of the rewards programs. I guess Walmart et al did the math and figured they would lose too much business.

The average Costco shopper makes over $100K a year, so getting another card just to shop there isn't a problem for most. Can't say the same for Walmart.

[DaiPlusPlus]

> The average Costco shopper makes over $100K a year...

While technically true, that statistic is misleading as it requires further qualification, namely that $100k figure only applies to shoppers in Costco's PNW area - not nationwide, and certainly not internationally.

[jedberg]

Not sure why you think it PNW only. The number came from the CEO of AMEX, back when they were the exclusive credit card provider for Costco. He said, in 2015, that the average Costco card holder made $100K a year. So presumably that would be in all of the US.

More recent attempts at analysis put the number closer to $125K these days for all their customers worldwide.

Which makes sense, given inflation and the fact that they only build Costcos in more affluent areas and target business owners.

[bombcar]

There's a subtle difference between "average Costco shopper" and "average Costco card holder".

[bombcar]

I was specifically wondering about the refund cost; I wonder if Walmart is eating the 1-3% on all refunds (I suspect the stores that DO eat it are the ones that really want to refund as store credit).

[ajaimk]

Walmart pays a lot less than 1-3%

[gtk40]

I work for a very well known retail brand and we've negotiated our average interchange fee to under 2%. I believe it is around 1.7% currently but it's been lower in the past.

[halestock]

In general, the more volume a merchant has, the larger their discount. But it's usually negotiated with the processors/issuers.

[bastardoperator]

I thought Walmart bought their own merchant bank/processor to avoid fees which sound like something walmart would do but I can't confirm, I know they're looking to expand on fintech services to consumers/business and that's difficult to do without some level of processing control.

[adrr]

Interchange is refunded but settlement fees aren’t. Settlement is 25Bps or lower.