Valentine’s Day spending is expected to reach an all-time high this year, with consumers across the United States projected to spend a total of $27.5bn, according to a survey by the National Retail Federation (NRF).

However, rising costs linked to credit card transaction fees could increase the financial burden on shoppers, industry experts warn.

Credit card fees adding to consumer costs

The Merchant Payments Coalition (MPC) estimates that card processing fees—often referred to as “swipe” fees—could contribute over $600m to consumers’ total expenditure this month.

These fees, which banks charge retailers for processing credit and debit card payments, are typically absorbed into the final cost of goods and services.

With the NRF survey estimating that the average consumer will spend $188.81 for Valentine’s Day, MPC calculates that “swipe” fees will add approximately $4.27 to each purchase.

This figure is based on the standard 2.26% rate charged by major card providers such as Visa and Mastercard, roughly equivalent to the price of a greeting card.

Retailers highlight concerns over rising charges

The Kentucky Retail Federation, which represents businesses across the state, has voiced concerns over the impact of these hidden fees. President Tod Griffin stated that while strong Valentine’s Day sales are encouraging, increasing transaction costs remain a challenge for both retailers and consumers.

The organisation is advocating for regulatory changes that would ease the financial strain caused by card processing charges.

According to MPC, bank card fees have risen by 50% since the COVID-19 pandemic, reaching a record $172 billion in 2023.

These fees are now the second-largest operating expense for many retailers after labour costs and are estimated to add over $1,100 to the annual expenditure of an average household.

Shopping trends and popular gift choices

The NRF survey also identified key shopping trends for Valentine’s Day. The most popular gift choices include candy (56%), flowers (40%), greeting cards (40%), an evening out (35%), and jewellery (22%).

Consumers cited online shopping (38%) as their preferred method of purchasing gifts, followed by department stores (34%), discount stores (29%), florists (18%), and speciality shops (18%).

The survey, which was conducted between 2-7 January and involved 8,020 adult participants, highlights how consumers are navigating rising costs while still engaging in holiday traditions.

 With spending at record levels, the financial impact of transaction fees remains a significant issue for both shoppers and businesses.