How to effectively use credit card reward points
Below are various ways to make the most of it using your credit card.
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Heather Bernhardt is the owner of a small business. But she has rants as a business owner and a client.
She can’t stand the growing practices of companies charging consumers extra fees to use credit cards.
“If you own a small store, if you own a store, the restaurant, and you should charge me an extra fee to use a credit card, I will not be back,” Bernhard said in a Tiktok post. “Eat. Good customer service.”
Bernhardt’s rage regarding credit card surcharges is not unique.
In two separate national surveys of consumers, shoppers said they are tired of nickel and dimming to pay the extra fees that were the cost of their business.
What are credit card extra charges?
According to an article on Wallethub, the practice of charging consumers with additional fees for transactions is permitted under a 2012 settlement between credit card networks and a group of US merchants. Additional charges range from 1.5% to 3%.
According to Walethub editor John Kiernan, when more consumers were moving to e-commerce and higher businesses and restaurants were dealing with higher costs, the practice of passing credit card transaction fees to consumers began to be handed over to consumers during the Covid-19 pandemic, by adding additional charges to their bills.
However, payments in 2012 only covered credit card transactions, and did not cover debit cards or prepaid gift cards. The Visa and Mastercard rules prohibit transaction fees for debit card transactions, but enforcement is rather lax, especially as it is not widely known among small businesses and consumers, Keenan told USA Today. In the case of credit card transaction fees, consumers are required to be notified in some way before the transaction takes place. If not, consumers can file a dispute with the credit card issuer, Keenan said.
Additionally, some states, such as Connecticut, Maine and Massachusetts, have state laws that prohibit additional consumer credit cards.
Customers do not like being nickel and dimmed at an additional charge
The use of credit card extra charges is actually widely used and also causes widespread discomfort.
A recent survey by Wallethub says 87% of people are “duck with nickel when asked to pay an additional fee for processing their credit card payments.” More than four in five Americans said they would not use credit cards if they were charged to pay with credit cards and two in three were charged.
More than three in five also said they thought it was unfair for merchants to hand over payment processing fees to customers.
Kiernan said the practice of adding additional credit card payments, or offering discounts on cash, common at many gas stations, has grown in recent years.
“I think businesses and consumers are always pushing boundaries and trying to test the water to see what they can get away with,” Keenan said.
When companies began to see other companies charging extras without much backlash, they started doing that too, he said.
In the JD Power 2025 US Merchant Services Satisfaction Survey released in January, 34% of merchants said they added an additional fee for customer purchases made using credit cards.
In the latest data from the JD Power US Credit Card Satisfaction Survey, 82% of shoppers who said they faced an additional fee to use their credit card chose alternative payment methods. John Cabell, managing director of Payments Intelligence, said the investigation did not ask if these customers had left the deal.
Consumers get mad at extra charges
Consumers don’t like such add-ons, said Ted Rothman, senior industry analyst at Bankrate.
“Additional charges are a type of way to raise prices without increasing prices,” Rothman told USA Today. They may be legal, but “in the court of public opinion… most people frown at add-ons of all kinds.”
Consumers may complain about management and social media. Social media “is actually even worse because I’m talking to all my friends about this bad experience,” he said.
Most shoppers are not carrying cash and are fighting both inflation and other rising costs, Rothman said. Businesses are facing similar headwinds.
“People already feel like it’s costly enough, so businesses are trying to transfer some of their costs to their customers,” he said.
Rothman said many customers are paying extra because they don’t carry cash or have debit cards.
But some customers are pushing back.
Rothman said he doesn’t understand the company’s philosophy of adding a surge because it angers customers and likely loses sales.
“We’re not back in a cash-first economy,” Rothman said. He added that such extra charges are “a sales deterrent.”
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Bernhard owns Blackbird Boutique in Marine City, Michigan. She sells women’s clothing, gift items and small home decorations. Bernhardt says it’s difficult enough to compete as a small business owner and wants to please its customers. She is not working on credit card extras.
However, she was angry enough after visiting another store that recently charged her to use her debit card – she didn’t know she wasn’t allowed until the reporter informed her – that she had put her rant on Tiktok. In her video, Bernhard said that companies should either eat the cost or “bake it” at the price of the item.
Such extra charges are bad for the business, she said.
“We probably lost a customer and we haven’t returned the customer and won future sales,” she said.
Are cash rewards or reward credit cards worth an additional fee?
If more consumers have to pay an additional fee, is it worth using their credit card to earn cashback rewards and other perks?
Rothman said he needs to consider how much consumers are paying for what they earn from their surcharges and compensation. He also said consumers will need to pay their credit card bills each month to avoid paying additional interest fees.
But credit cards can also offer additional perks like extended warranty, purchase protection and travel insurance, so that’s something to consider, Rothman said.
Consumers can also go ahead by choosing the right credit card, Keenan said.
“If you have the right cards or a collection of the right cards, you set yourself up to ignore a lot of this,” he said. “There are many cards that offer 5% cashback in custom categories. You can choose two categories per quarter. They are the categories you spend the most.”
He said that after using those cards for a general purchase, “even if you get charged an extra fee, it’s still coming out ahead.”
The extra fee may be more than what you earn from the reward, so you won’t be ahead of every deal, he said. But there are credit cards that also offer first points and cashback bonuses, he said.
“If you’re loading up a small purchase, even if they’re adding a small extra charge, if you’re saving $1,000 at the end of the day, it’s still out ahead,” he said.
Some consumers may use multiple cards, or debit or credit cards. Some consumers can also make automatic payments through a bank account or link their checking account to a retailer or business account to receive a discount.
Kiernan suggests you have a credit card with good rewards and hold a debit card in your hand when retailers want to charge an extra credit card.
However, he warns that debit card transactions will be coming out of your checking account immediately, and remember that debit card fraud protection is not as strong as credit cards.
Betty Lin-Fisher is a consumer reporter for USA Today. Contact her at blinfisher @usatoday.com or follow her on X, Facebook, or Instagram @Blinfisher, @Blinfisher.bsky.social.. Sign up for our free daily money newsletter. This includes Friday’s Consumer News.
