Tired of $18 burgers and $20 taco plates? Many diners are, as are some restaurant owners.
So some small businesses are sticking with cash-only policies nowadays to avoid the 2-3% transaction fees charged by credit card companies, helping them maintain lower prices for customers.
A visit to Herb and Thelma's Tavern, for example, is a trip back in time.
They have been serving up cold beer and hot burgers for 80 years — and not taking credit cards.
Owner Joe Fessler, still using an old-fashioned cash register, says he couldn't keep his burgers at just $7 if he had to pay card fees.
"Someone will come in and buy a Coke and give you a credit card. You might as well give it to them free because after all the fees and everything you pretty much lose money," Fessler said.
That's because credit card companies charge retailers around 2 to 3% of each credit card transaction.
Watch a restaurant owner explain how credit card fees raise prices for customers:
Card fees force businesses to raise prices
Doug Kantor with the National Association of Convenience Stores says these fees hurt small businesses the most.
"So either retailers give up all their profits and go out of business, or they have to calculate all these fees into the prices they charge consumers," Kantor said.
But Kantor has tips that help both consumers and retailers:
- Pay with cash and take advantage of any discounts retailers offer for paying with cash
- Negotiate with your credit card company
- Contact your member of Congress to help pass a law to bring more competition among payment networks
"Or if they have an extra charge for credit, there again, you can use cash, and that helps you, it helps the local business," Kantor said.
Fessler says he's not ready to move to Apple Pay and card tapping.
"Something is going right here. People keep coming back, so why reinvent the wheel," Fessler said.
And diners like Ralph Kelly are fine with it.
"I love it that it keeps the burger price down. And it keeps the burgers good too!" Kelly said.
So give your business to small businesses that don't take credit cards.
Just make sure you have $20 in your wallet, so you don't waste your money.
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This story was reported on-air by a journalist and has been converted to this platform with the assistance of AI. Our editorial team verifies all reporting on all platforms for fairness and accuracy.
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