The raising retail petrol prices at the pumps have been hurting the dealers as well as consumers. President of Petroleum Dealers Association of Malaysia Alang Zari Ishak mentioned in a report to Bernama on Monday that dealers have had to pump in extra working capital to purchase stocks that don’t contribute to revenue.
Petrol dealers currently get 8 cents sales margin per litre of petrol and 3.5 sen per litre for diesel. These figures have not changed since 2001, even though fuel prices have been hiked a few times.
This low sales margin combined with a higher working capital requirement to purchase petrol have been hurting the dealers financially.
One way they have found to cut loses is cutting credit card commissions. This means stopping credit card transactions.
Currently 35-50% of petrol sales are paid for by credit card, with the value ranging from station to station and area to area.
Banks charge 1.25 percent commission for petrol purchased via credit card. For example, for every litre of diesel purchased using a credit card, 1.601 sen went to the bank as credit card charges while the petrol station operator made a net profit of just 1.899 sen.
The petrol stations association have said they will stop accepting credit card payments for petrol if the bank charges are not reviewed.