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TULSA, Okla. -- QuikTrip Corp. based here is joining with Tempo Payments, Inc. to counter the high cost of credit-card acceptance by offering a company-branded debit card that will provide customers with lower-priced gasoline at the pump.
Starting with one of its major markets in the second quarter of this year, QuikTrip will begin a phased rollout of the debit card, which can be used at 200,000 other retail outlets nationwide that accept payments via Tempo, including Wal-Mart, Sam's Club and CVS.
"Reducing credit-card fees is a critical strategic initiative for QuikTrip and we're now able to do so by offering our customers our own QuikTrip-branded debit card, utilizing the Tempo Payment Network," said Paula Cotten, QuikTrip's treasurer and vice president of finance. "At the same time, the Tempo program enables us to provide an immediate benefit to those customers who are helping us control our costs."
Steady increases in bank-issued credit- and debit-card fees charged to merchants have severely impacted petroleum retailers, and the effect of higher gasoline costs has exacerbated the issue. Because card fees are based on a percentage of the sale, gas retailers pay a proportionately higher share of their revenue in interchange fees and realize lower-profit margins, according to San Mateo, Calif.-based Tempo.
"Savvy merchants like QuikTrip are enlisting consumers in the cost-control effort by passing on savings to encourage the use of their own lower-cost debit cards," said Mike Grossman, CEO of Tempo, which provides retailers a low-cost alternative to Visa and MasterCard. The company operates the Tempo Payment Network, a PIN-based payment network for retailer-issued and branded debit cards.
QuikTrip currently owns and operates 473 retail outlets in nine states.