Can I pass along credit card fees to customers?

Under a court settlement that went into effect in January 2013, retailers in many states are allowed to add a surcharge to credit (but not debit) card payments made by Visa and Mastercard. Currently, merchants can pass along fees in the form of a surcharge equal to what they pay to accept the card, up to 4\%.

Is it legal to make customers pay credit card fees?

Credit card surcharges are optional fees added by a merchant when customers use a credit card to pay at checkout. Surcharges are legal unless restricted by state law. Businesses that choose to add surcharges are required to follow protocols to ensure full transparency.

Can businesses pass on credit card fees to customers?

Currently, only Visa and MasterCard allow merchants to pass on fees; American Express and Discover prohibit merchants from doing so as part of their terms of service.

Are processing fees legal?

Credit card processing fees are legal, but rules have been established to regulate them. Both Visa and MasterCard now allow businesses to charge a processing fee for some credit card transactions. This fee can be as high as 4 percent of the transaction, and it helps the merchant cover their processing costs.

Is it legal to charge a credit card processing fee in Illinois?

Retailers in 40 U.S. states, including Illinois, can charge up to 4 percent extra when consumers pay for goods and services with a credit card. The fees are illegal in California, New York, Texas and seven other states. It is up to individual businesses to decide whether or not to add the fee.

Is it legal to charge a credit card fee in NY 2021?

The NYS Court of Appeals recently clarified NYS GBL 518 as follows: Merchants can charge two different prices for purchases – by credit card and by cash; The higher price charged to credit card users must be tagged and posted for consumers in actual “dollars and cents” form; and.

Is surcharging legal in Illinois?

This convenience fee or surcharge may be applied only when allowed under the operating rules and regulations of the credit card involved. No fee, or accumulation of fees, that exceeds the lesser of $5 or 5\% of the transaction involved may be imposed in connection with the payment of any fine.

Is surcharge legal in NY?

As part of its seven-part consumer alert holiday series, the New York State Division of Consumer Protection is reminding consumers that credit card surcharges are prohibited in New York State. Businesses are also able to offer a discount to consumers who pay in cash.

What is the difference between a credit card surcharge and a convenience fee?

A surcharge is applied for the privilege of using a credit card as a form of payment. Whereas a convenience fee is applied for the privilege of using a non-standard payment method for the merchant, such as using a credit card as payment if the merchant primarily transacts with cash.

Is it legal to pass credit card fees to customers in Illinois?

Is it legal to charge customers a credit card processing fee?

Whether or not a business can charge customers a credit card processing fee depends upon the state it’s located. Such surcharges are prohibited in 10 states, and there are implementation requirements in the rest. No cost processing programs achieve the same goal, and are legal in all 50 states.

What are credit card merchant fees?

Merchant fees are fees associated with processing credit cards. These fees vary depending on the type of business, the bank it has a merchant account with, and the credit cards accepted.

What is a credit card processing?

Credit card processing is the way in which merchants have the ability to accept and receive funds through their customers’ credit and debit cards. Typically, credit card processing involves signing a contract with a credit card processing company who then deposits proceeds from credit card sales into the merchant’s checking or savings account.