Credit Cards Mixed Blessing for Boston Cabdrivers - Other News


ADVERTISING DISCLOSURE: is an independent, advertising-supported web site. receives compensation from most credit card issuers whose offers appear on our site. Compensation from our advertising partners impacts how and where their products appear on our site, including, for example, the order in which they may appear within review lists. has not reviewed all available credit card offers in the marketplace.

Credit Card Applications » News » Other » Credit Cards Mixed Blessing for Boston Cabdrivers

Credit Cards Mixed Blessing for Boston Cabdrivers

Credit Cards Mixed Blessing for Boston Cabdrivers
The content is accurate at the time of publication and is subject to change.

Since the city of Boston mandated that cabdrivers accept credit card payments, there has been a huge surge in the use of credit cards to pay for cab fares. Having cab drivers accept credit card payments is definitely a convenience for cab riders, and also benefits cab companies as ridership goes up. Cab drivers are busier than ever, collecting more money and driving more miles. However, the flip side of the coin is that some drivers are actually experiencing lower incomes because of the fees they are paying out for processing the credit card payments.

Frequency of Credit Card Use

According to the website, one out of every four cab riders pays their fare with a credit card. Taxi meters are racking up more miles and more cab fares than the periods prior to credit card payment acceptance. While business is up, the costs are eating away at the profits.

Credit Card Processing Fees

For each credit card payment that a cab driver processes, the driver pays a five to six percent credit card processing fee. Some cab drivers are also paying a $1.50 transaction fee to withdraw cash from the merchant account where the credit card payments are deposited. On a $20 cab fare, the cab driver may be paying as much as $2.70 in fees, which of course, is coming out of his own pockets at the end of the day.

Increased Operating Costs

Add this to the soaring gas prices and some cab drivers find themselves in the perfect storm. These drivers are paying for credit card processing fees and paying out more at the gas pump. In Boston, gas prices are upwards of $4 per gallon. When taking all of these factors into consideration, cab drivers claim that they are barely taking home minimum wage.

Boston launched its program to accept credit cards in cabs in the middle of 2009 when the recession was at its height. Its 1825 licensed taxis all had card processors installed to make it more convenient for riders, particularly business users. But it was not the first big city to institute credit card processors in cabs. New York mandated the practice a few years prior to Boston. New York cab drivers also resisted at first, but later came to find it beneficial to them and their incomes. It’s possible that Boston cab drivers too will see the benefit in it after getting over the initial hurdle.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate information, however all information is presented without warranty. Consult a card's issuing bank for the terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.
Add to Favorites:

Related News:

A New Priority Pass Restaurant and Lounge in Washington D.C.

Posted: July 16, 2018

Hitting the lounge for some rest and relaxation when flying can be a great perk. And now people with Priority Pass membership - or a credit card giving them Priority Pass lounge access - have two new options to check out when passing ... Continue reading
New LL. Bean Credit Card

Posted: July 13, 2018

L.L. Bean's credit card portfolio was purchased by Citi Retail Services, and they have now partnered with MasterCard to launch a new credit card, offering 4% on purchases made at L.L. Bean. But that is not all; With the L.L. Bean ... Continue reading
5,000 Bonus Points From Hilton and Amex Offers

Posted: July 12, 2018

Are you planning a trip and thinking about staying at a Hilton Hotel? If so you might want to check out this new deal at Amex Offers, providing cardholders with 5,000 Membership Rewards points when they book a stay of $250 or more at ... Continue reading
Get the latest news, articles and expert advice delivered to your inbox. It's FREE.
Earn 5% cash back at different places each quarter like gas stations, grocery stores, restaurants,, or wholesale clubs up to the quarterly maximum each time you activate.
For Excellent, Good Credit
We'll match all the Miles you've earned at the end of your first year. For example, if you earn 30,000 Miles, you get 60,000 Miles.
For Excellent, Good Credit
0% Intro APR on Balance Transfers and Purchases for 18 months. After that, the variable APR will be 15.74% - 25.74% based on your creditworthiness*
For Excellent, Good Credit
You've successfully subscribed!

Please specify the following:All these fields are optional

Your Credit History
Themes you are interested in:

By providing this information you help us make our news letters more useful and informative. Thank you!