SALT LAKE CITY — Smith’s Food & Drug Stores announced at the beginning of March that they will stop accepting Visa credit cards beginning April 3, 2019.
In a press release issued early March 1st, Smith’s says the change comes due to “the excessive interchange and network fees that Visa and its issuing banks charge retailers,” it will drive up food prices.
The store says that they will continue to accept all other forms of payment and major credit cards, electronic benefit transfer cards from SNAP and WIC programs as well as Mastercard and that they will still be accepting Visa debit cards.
They said that in the highly competitive food retail market the high fees that Visa charges exceed the margins that the store has.
“This was a very hard decision to make,” Martindale told Dave & Dujanovic, acknowledging that, while a little blowback over the new policy was inevitable, it was something they wanted to avoid. “Our customers are what keeps Smith’s alive and thriving.
“Every time that a customer swipes their card, a retailer such as Smith’s is charged for each transaction,” she says. “And the problem here, as it relates to Visa, is the fee charged by Visa’s issuing banks is excessive… Their credit card is significantly higher than any other credit card brand that we accept.
“Our commitment and our promise to them is that we’re going to provide those quality products at a low price,” she continued. “In order to keep those prices low, we have to control costs. And, unfortunately, Visa hasn’t left us the flexibility to do that.”
Martindale says they are still in talks with Visa and hope they can change this back in the future.
The grocer employs over 20,000 associates and operates 55 stores in Utah; 45 stores in Nevada; 23 stores in New Mexico; 7 stores in Wyoming; and 4 stores each in Idaho, Montana and Northern Arizona.
Smith’s will become the second Kroger brand to decline the acceptance of Visa credit cards following the California based Foods Co. Supermarkets
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