California Kroger Subsidiary Says No To Visa

Foods Co, a subsidiary of grocery giant Kroger, has announced that 21 of its grocery stores and five of its gas stations in Central and Northern California are officially through with Visa branded credit cards as a form of payment, effective August 14, 2018.

According to a release by Foods Co, Visa is officially off the payments menu in-store so that the chain can stave off some of the high costs associated with the card when it comes to interchange rates and network fees.

“Visa’s rates and fees are among the highest of any credit card brand,” Foods Co noted in their release, saying that the savings netted by pulling the plug on Visa will be passed along to consumers in the form of everyday low prices on high priority goods for grocery shoppers.

The move will only effect Visa credit customers — Visa debit cards can still be used for purchases.

“Our customers consistently tell us that one of the most important factors in choosing Foods Co as their supermarket of choice is our low prices,” said Bryan Kaltenbach, president of Foods Co. “At Foods Co, we are committed to saving our customers money. Today’s decision will help Foods Co continue to deliver great value to our customers with low prices, fresh products and friendly service.”

The move will affect six San Francisco Bay area stores, four stores in the Sacramento Valley, and seven stores serving the Central Valley, from Bakersfield to Fresno.

In addition, five Foods Co fuel centers will also discontinue acceptance of Visa credit cards.

“We realize this will be a change for some customers,” said Kaltenbach. “But we believe this change will benefit all our customers by allowing our Foods Co stores to continue to offer the things our customers value most, including our low prices, fresh produce and services, more than payment type.”

Visa, for it’s part has responded to the Food Co choice – noting that they are continuing to work with Kroger to find a mutually acceptable solution for all parties.

“Visa is disappointed at Kroger’s decision to stop accepting Visa credit cards at its Foods Co. stores. When consumer choice is limited, nobody wins. Our goal is to protect the interests of our cardholders to ensure they can use their Visa credit cards wherever they shop. Visa remains committed to working with Kroger to reach a reasonable solution,” a Visa spokesperson told PYMNTS via email.

Visa, it seems, is the only credit card off the table at this point — MasterCard, American Express and Discover cards are all still usable.