Paying by Plastic at the Gas Pump

There is a lot of complexity related to payments at the pump depending on whether a customer is paying by cash, credit or debit. 

January 9, 2025  read

Convenience stores sell about 80% of the gasoline in the United States, and most of those transactions are with credit and debit cards, according to NACS State of the Industry data. Here are some common topics related to payment cards and fueling.

Offering Cash Discounts
Paying with plastic costs more for retailers than cash. Therefore some retailers may offer discounts for cash payments to help cut down costs.

Typical fees for a 10-gallon fill-up (at $3 per gallon):
  • Cash: No fees
  • Debit: About 2.4 cents per gallon in extra costs. Debit fees are 21 cents per transaction plus other costs.
  • Credit: 7.5 cents per gallon in extra costs. Credit card swipe fees include both fixed and variable costs, averaging about 2.5% at the pump.
Some retailers may also offer cash discounts at the pump when a customer makes another purchase, like a car wash. State departments of Weights and Measures set the rules for how these discounts are offered, and retailers usually have to post the higher (credit) price prominently.

Debit Holds
Holds are standard for any business that accepts plastic when the final amount isn't known upfront, like for fill-ups, hotel rooms, or car rentals.

Visa and MasterCard require holds or pre-authorizations on debit and credit card gas purchases. While it might look like the retailer placed the hold, they're only responsible for setting the amount. The bank issuing the card decides the length of the hold.

When a customer buys gas, two charges hit their account. One is an authorization charge, usually for $1, to make sure the card is valid, and then it's removed. The second is the hold, required by card network rules. The bank issuing the card is responsible for the length of the hold—not the retailer.

The hold amount and time can vary, but PIN-debit transactions are real-time and should be released within minutes. Signature-based debit transactions (without a PIN) are processed like credit cards and can take several days to clear.

Entering ZIP Codes
In some areas, retailers ask for a 5-digit ZIP code associated with a card before fueling. This helps prevent fraud. If a ZIP code is entered incorrectly, the card will be declined. This might be inconvenient for law-abiding customers, but it's a bigger hassle for criminals.