In a way, a surcharge penalizes shoppers who use credit cards. A discount takes the opposite approach by encouraging buyers who don`t. For a discount to work, simply increase your prices by two to three percent (roughly equivalent to your processing rate), and then offer a discount for those who pay in cash. No, it is not. The settlement agreement affects the clearing rules for credit card purchases made only in the United States and U.S. territories. Surtaxes remain prohibited outside the United States unless there is a local law or exemption requiring merchants to be allowed to practice the practice. Unfortunately, you can`t choose which products or types of transactions you want to add a supplement for. You can choose to charge at the brand level (all Visa transactions, i.e. all MasterCard cards and all Discover cards, and therefore all American Express cards) or at the card level – only certain types of cards (i.e. those with higher fees). However, card-level surcharges seem a bit complicated to me, as all network surcharge rules are interconnected.

Visa and MasterCard, for example, are identical. American Express basically says you can`t add extra for Amex cards ONLY (which would discourage customers from using these cards). Before reviewing the card federation guidelines for supplements, you should review the laws of the states where your company operates. At the time of writing, several states have banned credit card fees, justified by the fact that they are unfair to consumers. Others have been challenged and their bans lifted. Unfortunately, there is no research on the effects of surtaxes and their prevalence in the United States. The next episode was an Australian government investigation. The survey found that 68% of respondents believe retailers and other businesses should not charge their customers extra fees for credit card payments. A surcharge is a commission paid by a customer who chooses to purchase a good or service using a credit card. A company adds this additional fee to the advertised price to cover the cost of credit card processing fees. Supplements are legal in most states, but there are rules that must be followed by the company.

Some card lines are subject to additional product-level fees. For some products, you may charge different surcharges. Finally, rewards cards and commercial cards often cost more than your standard consumer card. However, you must comply with the top-up guidelines for Visa and Mastercard products. One. In general, no. Reloads are currently allowed in Australia, Mexico and New Zealand, as well as some credit card transactions in the United States. You are right. Merchants cannot charge additional fees on a debit card, even if it is secured by funds and bears the Visa/MasterCard logo.

However, not everyone is aware of this fact, especially since Square doesn`t have a direct debit processing option. All these debit cards are treated as credit. The trader is probably not aware of this and is not doing it with malicious intent. Yes. The professional who decides to collect surcharges must affix the surcharge at the place of entry into the establishment, at the point of sale and on the receipt given to the consumer. Online retailers must publish the notice on their websites. The reward notice must be printed on the receipt. The receipt must also show the dollar amount of the surtax. Once you read and understand the basic rules that affect the load, there is still more work to be done. You must inform your acquiring merchant and the relevant card networks that you intend to pay extra. Finally, you need to make sure that your POS is able to register surcharges to meet the requirements of the card network.

Question: I do business in several states. I understand that state laws prohibit me from charging surcharges in some states where I operate, but not in others – does that mean I can`t charge extra in any of the states where I operate? The dollar supplement must appear on the receipt. Melissa, 1. Can I charge a 4% surcharge, whether it`s a swipe or key credit card transaction? 2. How do I know if they are using a credit or debit card? If the surcharge is illegal, the cardholder must dispute the amount of the surcharge directly with the bank. Have you ever paid for something with a credit card, only to learn that you`re charged a fee for using a card instead of cash? These fees are called credit card surcharges and are more common than you might think. Retailers may choose to charge these fees to offset the credit card processing fees they must pay. Discount program. A company may offer a discount to customers who pay cash to reduce the number of card transactions.

Additional fees are based solely on the processing rate you pay, and you can apply them to certain credit card products or card brands. Convenience fees, on the other hand, may be charged for credit and debit card transactions and may exceed your processing costs. However, in some states, there are ongoing litigation that affects attribution rules. For example, Colorado has passed a new law to allow surtaxes, which will take effect on July 1. Before proceeding with a surtax program for your business, you should review your state`s laws. With the rule that surcharges cannot exceed 4%, how can local government agencies get away with charging flat rate “surcharges”, for example $10 for all policy quotes? In future cases, it could be less than 4%, but in other cases much more. Do they not meet the same standards? Once you`ve made sure it`s legal for you to apply a surcharge in a particular state, there`s still some work and research to do. The price must be announced at the entrance of the shop and at the point of sale. The award notice must appear on the company`s homepage for online transactions. How does all this affect large companies that have multiple locations? If your business operates in multiple states, you can always add a supplement in states that allow the practice — but not those with prohibitions. You should also check that you comply with each state`s laws on the charge. Now that we`ve covered the ground rules, let`s take a closer look at some of the most common issues that arise from credit card surcharges, how much you can actually charge the person you need to contact.

Thank you for reading and asking your question. Here`s what Melissa explains in her post, and hopefully this clarifies for you: So, is it legal to charge credit cards? In most states, yes, but it`s not always the right choice. In reality, if you`re struggling with processing fees, your best bet might be to compare merchants, a company that accepts credit cards for goods or services. And try to reduce your costs as much as possible before increasing costs for your customers. While you`ll need to be careful about how you use supplements to make sure you don`t make one card brand look better than another, there`s no rule against making another form of payment (like cash) more appealing than using a credit card. Of course, the discount system forces you to raise prices, which could hurt your business if you don`t make the “spot price” clear to buyers. We have a local restaurant that charges a flat surcharge of 69 cents on credit and debit cards. This fee is charged regardless of the total amount. This can correspond to a fee of 8 to 10% for a small meal. Is it allowed or legal? Convenience fees and discounts are sometimes confused with additional fees. Although they are similar in some ways, there are distinct differences between them.

The problem is that while additional fees are prohibited, convenience fees are not. As a roommate in Kansas, I paid a lot of convenience fees for online payments (especially utility bills). My apartment complex charges a convenience fee for credit transactions and uses a separate processor to accept e-checks. There are separate laws regarding convenience fees, but you can usually only add one if a credit/debit card is an alternative to the standard payment method. For example, a car wash that deals primarily with cash might charge a convenience fee for card transactions. Similarly, a stadium that sells the most tickets at the window may charge a comfort fee for those who buy tickets online. Credit card surcharges are fees that are added to a credit card transaction. Some retailers choose to add these fees to a customer`s bill to cover the cost of the credit card processing fee that the business must pay. In most cases, additional credit card fees are low. For example, a customer may be charged $1.00 for using a card. If we talk about “If your company operates in one of these states, it`s illegal to charge extra,” is that the state I`m shipping the product to, or the state I`m going to send an invoice to, or my warehouse status or back-office status?.