As dealerships reflect on financial performance and plan for a stronger 2026, one operational expense stands out for its rapid growth and lack of visibility: credit card processing fees.
These fees impact Service, Parts, Sales, F&I, and Rentals, often without dealers knowing the actual cost, the source of the increases, or the options available to reduce them.
Despite being one of the largest controllable expenses in the dealership, credit card fees are still treated as an unavoidable cost of doing business.
But that perception is shifting, and for good reason: credit card fees are not fixed, and dealers have more control than they realize.
This guide explores why costs continue to rise, where profits are being lost, and why now is the ideal time for dealers to evaluate their true savings potential.
The Growing Cost of Credit Card Usage in Dealerships
Dealerships are processing more credit card transactions than ever before. Convenience, rewards incentives, and customer expectations continue to increase card usage in every department.
But higher volume isn’t the only reason fees keep rising.
- Fixed Ops Drives the Largest Share of Fees
Service and Parts handle a high percentage of card-present transactions. As repair orders climb, so do related processing fees, often dramatically.
- Higher RO Totals Mean Larger Fee Amounts
Inflation in parts, labor, and diagnostic services pushes transaction sizes higher, which directly increases fees.
- Premium Rewards Cards Cost More
Customers love rewards cards, but the dealership absorbs the higher interchange cost tied to these premium cards.
- Many Dealers Lack Full Visibility
Most stores cannot easily identify:
- What they pay per department
- How fees are calculated
- Which card types cost the most
- Whether they’re being overcharged
Lack of clarity makes it impossible to know whether fees are fair, inflated, or avoidable.
Why Dealers Are Reassessing Credit Card Expenses
With margins tightening and costs rising, dealerships nationwide are asking deeper questions:
“Why do these fees increase every month?”
“How much of this expense should we actually be absorbing?”
“Are we missing opportunities to recoup these costs?”
These questions surface across Automotive 20 Groups, industry roundtables, controller and CFO meetings, and GM peer discussions.
Dealers see others reducing expenses and are beginning to ask themselves, “Are we behind?”
Compliance: The Overlooked Piece of the Puzzle
Credit card fees aren’t just a financial issue; they’re a regulatory one.
Rules differ by:
- State
- Card networks (Visa, Mastercard, etc.)
- Transaction environment
- Department workflow
When dealers attempt to manage fees on their own, they often create risks without realizing it, including:
- Improper disclosures
- Incorrect fee structures
- Potential card brand violations
- Chargeback exposure
- CSI vulnerabilities
This is why so many stores hesitate to make changes. The savings are appealing, but the compliance path isn’t clear.
The Financial Impact: What Dealers Could Be Saving
What surprises dealers most is not how much they’re paying, but how much they could be saving.
Stores that complete a proper analysis often uncover:
- Tens of thousands of dollars in monthly fees
- Significant variability across departments
- Misaligned fee structures
- Hidden billing categories
- Savings opportunities they never knew existed
The truth is simple: most dealers have no idea how much profit is being lost each month until someone shows them.
Why Now Is the Right Time to Evaluate Your Costs
There’s no hard deadline for addressing credit card fees, but there is a strategic advantage to getting started now.
Prepare for a stronger financial start in 2026
Understanding your true costs today allows you to forecast accurately and adjust budgeting immediately.
Rising consumer payment trends
Credit card usage is increasing, which means fees will only continue climbing for dealers who do nothing.
Competitive insight
Dealers in Automotive 20 Groups and peer networks are already evaluating solutions. Early adopters are securing financial advantages others haven’t tapped into yet.
Clearer decision-making
The sooner you understand your true cost structure, the sooner you can make informed operational decisions.
How Are Dealers Reducing Costs Without Hurting CSI?
Automotive retailers are successfully reducing or recouping credit card expenses through industry-specific, compliant solutions designed to protect customer satisfaction. There is no one-size-fits-all approach.
The best strategy depends on each dealership’s:
- Volume
- State regulations
- Department structure
- Payment environment
- Card mix
This is why no blog, webinar, or article can outline a universal solution. Results come from analysis, technology, and training models that vary store to store.
The key takeaway: dealers are saving, and the path begins with understanding your own numbers.
Conclusion: A Practical Next Step for Dealers
Every dealer reaches a point when they realize credit card expenses are higher than expected and that they’ve been absorbing costs that could potentially be reduced or recouped.
Dealer Merchant Services helps dealers uncover these opportunities through a compliant, automotive-specific approach. Our patented technology and dealership-focused training model protect CSI while providing a structured, transparent way to regain control of one of the largest operating expenses.
With 1,000+ rooftops, more than $62.5M saved, and 15,000+ dealership employees trained, we’ve seen firsthand how much profit dealers are unknowingly leaving on the table.
If you’re preparing for a stronger financial year, now is the time to understand your true processing costs and what you could be saving.
Request your complimentary Savings Analysis today and see what your dealership could recover going into 2026.
References:
National Automobile Dealers Association (NADA) – Annual Financial Profile of Franchised Dealerships
Cox Automotive – Fixed Ops Revenue & Consumer Payment Trends
Visa & Mastercard – U.S. Merchant Surcharge Compliance Requirements
Automotive News – Operating Cost Trends in Retail Automotive
Federal Reserve – U.S. Credit Card Interchange Fee Data
J.D. Power – Customer Service Index (CSI) Study
PaymentsJournal – Economic Impact of Merchant Processing Fees
Dealer Merchant Services – Internal Analysis Across 1,000+ Rooftops