Kroger Escalates Feud With Visa

Stores in seven states no longer accept Visa credit cards
Photograph courtesy of Kroger

CINCINNATI  Kroger shoppers using Visa credit cards may now find it difficult to shop at another of the company's brands. The Kroger Co. announced Friday that its Smith’s Food & Drug Stores division will be the second Kroger banner to stop accepting Visa credit cards as a form of payment, starting April 3, 2019. The decision will not affect any other form of payment.

Salt Lake City-based Smith’s operates 55 stores in Utah; 45 stores in Nevada; 23 stores in New Mexico; seven stores in Wyoming; and four stores each in Idaho, Montana and Northern Arizona. Smith’s follows 21 Foods Co. supermarkets and five fuel centers in California, which stopped accepting Visa credit cards in August 2018.

"Visa has been misusing its position and charging retailers excessive fees for a long time," said Mike Schlotman, Kroger's executive vice president and CFO. "They conceal from customers what Visa and its banks charge retailers to accept Visa credit cards. At Smith's, Visa's credit-card fees are higher than any other credit-card brand that we accept. Visa's excessive fees and unfairness cannot continue to go unchecked. That's why, starting April 3, Smith's will accept all forms of payment except Visa credit cards."

“All forms of payment” includes major credit cards such as Mastercard, Discover, and American Express; cash and checks; electronic benefit transfer cards from SNAP and WIC programs; MasterCard and Visa debit cards both with and without a PIN; and health savings account cards.

In an attempt to ease the transition for shoppers, Smith’s is offering all customers double the rewards points toward fuel purchases through May 21. Additional savings in groceries and fuel are available for qualifying customers.

In a statement, Visa called Kroger’s move “unfair and disappointing,” and said the company is working toward a solution with Kroger.

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