Now surcharging is allowed in most states. The states that don’t allow surcharging are Connecticut, Colorado, Maine, Kansas, Massachusetts, and Oklahoma. New York and California have specific laws limiting credit card surcharging, but they are currently not enforceable.
Credit card surcharging is not allowed in other countries except for Mexico, Australia, and New Zealand.
If you operate your business in multiple states in the US where surcharging laws vary, ensure you only apply the surcharge fees in the states where it is allowed. Each state has its rules regulating surcharges, so it’s essential to learn the state requirements of each location you intend to include a surcharge.
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The rules for credit card surcharging.
Surcharging may be permitted in most states in the US, but there are rules around the practice that merchants need to be aware of.
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You must ensure your customers are aware of the surcharge. It must be properly disclosed.
It’s essential to properly disclose the amount and presence of a surcharge to your customers at the point of sale. If you run a brick-and-mortar store, ensure there is signage indicating that. If you have an eCommerce store, you can have the information included on the checkout page so that your customers are aware when paying using credit cards.
If collecting on accents receivable, indicate the existence and the amount of the surcharge wherever you are directing your customers to pay, such as an online payment portal. The message should be clear before the customer fills in their card details for payment.
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You should also indicate the surcharge as a line item on your customer’s receipts and in your accounting software.
Before implementing a credit card surcharge, you must notify your merchant service provider and your card brand.
If you intend to start surcharging your customers, notify your merchant’s service provider and your credit card networks in advance.
