The issue is there's a huge disparity in the fees for certain payment methods.
Some cards cost merchants much more than others, but they are contractually forbidden from differentiating their prices based on that. It's anticompetitive. Lots of "buy now pay later" schemes work similarly, when afterpay was (or is) a big thing they charge 7% and forbid the merchant from including that cost in their prices.
If the consumer had to bear the cost of their payment choice, no problem, but the reality is consumers with low fee payments are paying slightly more than they should for everything and those with high fee payments pay less than they should for everything.
Some cards cost merchants much more than others, but they are contractually forbidden from differentiating their prices based on that. It's anticompetitive. Lots of "buy now pay later" schemes work similarly, when afterpay was (or is) a big thing they charge 7% and forbid the merchant from including that cost in their prices.
If the consumer had to bear the cost of their payment choice, no problem, but the reality is consumers with low fee payments are paying slightly more than they should for everything and those with high fee payments pay less than they should for everything.