Credit Card Surcharges

What You Need to Know

Surcharging Can Be Very Risky


Surcharge Definition:

A surcharge is an additional charge a merchant places on top of a credit card purchase to help cover the merchant’s credit card processing fees.


Some states have laws prohibiting this. As recently as 2016, that list included California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma and Texas. In some cases, merchants may offer a cash discount instead. In other cases, that isn’t allowed either.

In 2017, New York state’s no-surcharge law was undercut by the US Supreme Court, making surcharges essentially legal in that state and many states with similar laws. But even then, merchants have specific guidelines requiring signage that explains the surcharge, guidelines dictating minimum purchases, and guidelines for the maximum surcharge percentage.

A merchant who violates these rules can potentially have its merchant account locked, and be prohibited from taking credit card payments going forward. Thus, it’s crucial that you familiarize yourself with your local laws, and comply fully.

For reference, here are Visa’s guidelines for merchants.

In addition to potential legal roadblocks, many consumers have a negative view of surcharging. But for some merchants in states that allow it, the benefit of recuperating one’s merchant service fees through surcharging can outweigh the bad publicity.

This page exists for informational purposes only and does not constitute legal advice. If you are a consumer or a merchant and have questions regarding credit card surcharges, please contact an attorney or your state attorney general.


About Verisave: we are expert merchant account auditors and consultants. We are NOT a credit card processor.

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Jacque Fanning – Mary Lanning Healthcare – Hastings, NE

Prior to learning about Verisave, we engaged with another audit company that created a minimal savings to our merchant account. Once that agreement was complete, we brought in Verisave and they successfully implemented a savings significantly greater than what the previous company had found. Verisave’s experience and knowledge allowed this savings to be implemented without any disruption to our credit card processing, guiding us through the entire process. I would highly recommend Verisave to any company looking to reduce their credit card processing fees.

Jacque Fanning - Mary Lanning Healthcare - Hastings, NE

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