Surcharging, explained without the legal fog

The rule that matters more than all the others

You cannot surcharge a debit card. Ever. Not a prepaid card either. Not even when the customer chooses "credit" on the terminal.

This is a card-network rule, not a state law and not a processor policy, so there is no jurisdiction where it is different and no program that gets around it. Whatever share of your business runs on debit, you keep paying full processing on it.

For a convenience store that can be more than half of card volume. Which is why we usually recommend dual pricing to those businesses instead.

What you are allowed to charge

The smallest of these three:

• Your actual cost of accepting that card. A surcharge is cost recovery, not a revenue line. You may not profit from it.
• The card-network cap. Practically 3% for any merchant that accepts Visa.
• Your state cap, where one exists. Colorado limits it to 2%.

What you have to do

1. Register before you start

   The card networks require advance notice. Starting without it is a compliance problem, not a formality. We file it for you.

2. Disclose at the entrance and the point of sale

   Signage where people can see it before they decide. Online, before checkout. Not a sticker on the terminal facing you.

3. Apply it to eligible credit only

   Your terminal identifies card type and applies the fee automatically. This is configuration, not something staff should be judging.

4. Show it as its own line on the receipt

   Separately stated, as a fee. This is what protects you when a customer disputes it.

5. Cap it correctly

   Never above your cost, never above the network cap, never above your state cap.

Where it is restricted

Connecticut, Massachusetts, Maine and Puerto Rico are the conservative set where we will not present surcharging as available.

Several other states have litigated statutes, injunctions, or specific display requirements. New York, for instance, requires that the total credit price be posted as a dollar amount rather than expressed as a percentage add-on. California, Florida, Kansas, Oklahoma, Texas and Utah have all seen legal activity worth confirming before you begin.

This area genuinely moves. Phase 3 confirms your state and your setup before anything goes live, and if the answer is no, dual pricing is almost always still available.

The full state table →

The mistakes that cause problems

• Surcharging debit because the terminal was not configured to tell the difference
• Rounding the fee up to a convenient number, which puts you above cost of acceptance
• Signage only at the counter, so the customer finds out after choosing
• Folding the fee into the price instead of stating it separately on the receipt
• Starting without registering, then getting a notice months later

None of these are exotic. All of them are avoidable with a setup done properly once.