TL;DR

Dropp has partnered with Pinnacle Corporation to introduce Pay-by-Bank and Pay-by-Stablecoin payment options for U.S. fuel and convenience retailers through the Affiniti Cloud POS system. This solution cuts transaction costs by up to two-thirds compared to traditional card networks, offers instant settlement, and eliminates chargebacks. Built on U.S. real-time payment rails and Hedera’s distributed ledger technology, the platform processes payments in USD and USDC stablecoin. Pinnacle already handles over 20 billion gallons of fuel annually worth $66 billion, representing 14% of the U.S. total. For retailers where average transactions run under $10, this technology could reshape profit margins by dramatically reducing payment processing fees that have long eaten into their bottom line.

How Dropp and Pinnacle Are Slashing Payment Fees for Fuel Retailers

I’ll be honest – before I got into the payments industry, I never thought much about payment processing fees until I saw the math on what convenience stores actually pay. When you’re selling a $6 coffee or a $15 gas fill-up, losing 2-3% to credit card companies hurts. Now multiply that across thousands of transactions daily, and you start to see why retailers have been desperate for alternatives. That’s what makes the Dropp-Pinnacle partnership interesting.

The Problem Nobody Talks About at the Pump

Card processing fees are the quiet killer for fuel and convenience retailers. You swipe your Visa at the pump, get your gas, and drive off thinking nothing of it. The retailer just paid somewhere between 1.5% and 3% of that transaction to payment processors.

Pinnacle Corporation processes over 20 billion gallons of fuel each year. That represents roughly $66 billion in sales, about 14% of all fuel sold in the U.S. Their cloud-based POS system, Affiniti, serves everyone from single-store operations to chains with 1,300 locations. These retailers move between 10 million and 7 billion gallons annually.

Here’s where it gets painful: when your average in-store transaction sits under $10, those percentage-based fees become brutal. A $7 purchase losing 2.5% means $0.175 goes straight to payment processors. That’s roughly 2.5% of your revenue vanishing before you calculate any other costs.

The numbers compound fast. For a mid-sized chain processing millions in monthly transactions, card fees can easily reach six or seven figures annually. That’s money that could go toward better wages, lower prices, equipment upgrades, or simply staying competitive.

What Dropp Actually Built

Dropp created a payment system that runs on two rails: U.S. real-time bank transfers (in USD) and stablecoin payments (using USDC on Hedera’s distributed ledger). Both methods settle instantly and cost a fraction of what card networks charge.

The Pay-by-Bank option connects directly to customers’ bank accounts, similar to how ACH works but in real time. No card network middleman. No interchange fees. Just bank to bank, settled in seconds.

The Pay-by-Stablecoin option uses USDC, a dollar-pegged digital currency, on Hedera’s network. Hedera is a distributed ledger technology (think blockchain but different architecture) that processes transactions quickly and cheaply. Because it’s digital currency moving on a decentralized network, there’s no traditional payment processor taking a cut.

Sushil Prabhu, CEO of Dropp, explained their approach: “SMB and enterprise merchants have long sought a simpler model to reduce the high cost of payment acceptance. Through our partnership with Pinnacle, we are delivering on our promise, bringing cost-effective, real-time banking and stablecoin rails to everyday purchases.”

Both payment methods plug directly into Pinnacle’s Affiniti Cloud POS system. Retailers don’t need new hardware or complicated integrations. The tech lives in the cloud POS they’re already using.

The Two-Thirds Cost Reduction Claim

Dropp says merchants can cut transaction costs by up to two-thirds. Let’s break down what that actually means.

Traditional card processing typically costs 1.5% to 3% per transaction, plus fixed fees of $0.10 to $0.30. On a $10 purchase at 2.5%, that’s $0.25 in fees. Over a million $10 transactions, you’re looking at $250,000 in processing costs.

Pay-by-Bank and Pay-by-Stablecoin transactions reportedly cost a fraction of that. While Dropp hasn’t published exact fee structures publicly, real-time payment networks generally charge flat fees measured in cents rather than percentages. If you’re paying $0.05 to $0.10 per transaction regardless of size, that $10 purchase suddenly costs 90% less to process.

The math shifts dramatically for small transactions. A $5 coffee at 2.5% card fees costs $0.125 to process. At a flat $0.05 fee, you’ve cut costs by 60%. For a $20 transaction, savings are less dramatic but still material.

Bob Johnson, President and CEO at Pinnacle Corporation, connected this to retailer operations: “By partnering with Dropp, we’re equipping our merchants with an alternative payment option that slashes transaction fees, strengthens cash flow, and delivers a simpler, seamless checkout experience for consumers.”

Instant Settlement Changes Cash Flow

Beyond lower fees, instant settlement matters more than most people realize.

Traditional card payments take 1-3 business days to settle. You make a sale Monday morning, and the money hits your account Wednesday afternoon. For businesses running tight margins or needing to pay suppliers quickly, that delay creates real friction.

Dropp’s system settles transactions immediately. The customer pays, the merchant receives funds in their account within seconds. No waiting period. No settlement batches. No reconciliation delays.

For fuel retailers managing inventory costs and supplier payments, instant access to sale proceeds improves working capital. You can restock faster, pay invoices sooner, or simply maintain better cash flow visibility.

The finality also matters. Card payments can be disputed or charged back for months after the original transaction. Dropp’s system creates irrevocable payments. Once the transaction completes, it’s done. No chargebacks. No disputes draining resources months later.

Built-In Loyalty Without the Complexity

Dropp includes loyalty and offer tools in the platform. Retailers can create rewards programs, push targeted offers, and drive repeat business without bolting on separate loyalty software.

This matters because fuel and convenience stores rely heavily on repeat customers. Someone who stops for gas twice a week represents more lifetime value than someone passing through once. The ability to incentivize return visits directly through the payment system creates opportunities traditional card networks don’t offer.

The privacy angle is interesting too. Consumers maintain more control over their data compared to card networks that track and monetize purchase histories. Reducing fraud risk protects both customers and merchants from the costs associated with payment fraud.

The Hedera Technology Piece

Hedera deserves a closer look because it’s not just another blockchain.

Hedera uses a hashgraph consensus mechanism rather than traditional blockchain architecture. Without getting too technical, it processes transactions faster and more efficiently than most blockchains. Transaction finality happens in seconds, and costs remain low even during high volume.

For stablecoin payments, this matters because you need speed and low fees for retail point-of-sale use cases. Bitcoin takes too long. Ethereum costs too much. Hedera hits a sweet spot where transactions confirm fast enough for retail and cheap enough to undercut card networks.

USDC, the stablecoin Dropp uses, maintains a 1:1 peg to the U.S. dollar. Circle, the company behind USDC, holds dollar reserves backing each token. This reduces volatility – you’re essentially moving dollars digitally rather than speculating on crypto price swings.

The combination of Hedera’s speed and USDC’s stability creates a payment rail that works for everyday commerce, not just crypto enthusiasts.

“When you’re processing billions in transactions, every fraction of a percent matters. Pay-by-Bank and Pay-by-Stablecoin is fundamentally changing how money moves through retail, and the savings are immediate.”

– Max Avery, CBDO, Digital Ascension Group

What This Means for Payment Processing

This partnership represents a real challenge to the card network duopoly. For decades, Visa and Mastercard have dominated payment processing with limited competition. Their fee structures remained stable because merchants had few alternatives.

This system breaks that dynamic. It’s not a new card network trying to beat Visa at their own game. It’s a different game entirely – one that routes around card networks completely.

The timing helps too. Real-time payment infrastructure in the U.S. has matured significantly in the past few years. FedNow launched in 2023, giving banks another rail for instant transfers. Stablecoins have proven they can operate at scale. The technology pieces are finally in place for alternatives to work.

If Dropp and Pinnacle execute well, we might look back at this as an inflection point. Not because pay-by-bank and stablecoins will replace cards entirely (it won’t) but because it creates real competition that forces the entire industry to rethink pricing and value.

Why This Actually Matters

Payment processing feels invisible until you run a business. Then you notice every transaction fee chipping away at margins.

For the first time in decades, card networks face genuine competition in everyday retail transactions. That competition benefits merchants through lower costs and consumers through better experiences.

The fuel and convenience sector might just be the beginning. If Pay-by-Bank and Pay-by-Stablecoin prove themselves here, other retail segments will follow. The payments industry could look very different in five years.

And for retailers who’ve spent years watching card fees eat into profits, that future can’t come soon enough.