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On the other hand, they fund that ability off significant fees whenever you buy something with a debit/credit card. You rarely see those fees, but the shop does, meaning the shop has to increase prices of everything by a couple of percent to cover it - and usually don't provide a discount when you're paying by cash.

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I don't have the time for sources at the moment, but I'm pretty sure there are regulations to make it illegal to offer cash discounts in most states, as it helps both credit card processors and tax collection enforcement, it was very easy to lobby for

Edit: I'm wrong, it's complicated.

At least in the UK, merchants pay very low fees to process debit card payments, to the extent that some merchants (e.g. budget airlines) do not accept or charge a penalty for using credit cards.

Merchants pay up to 1.75% (Square) to process in-person payments. Whether this cost is embedded into the prices of what you buy or whether it's made clear to you is irrelevant to that point - that you're paying this. And even when credit cards are more expensive to process - do you ever get a discount for using a debit card at the supermarket? Cash?

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