Surcharging is applying a fee on top of a bill if a consumer uses a credit card to pay. If you are thinking about implementing a Surcharge in your establishment, here a few things you need to consider:
Is it legal to allow Surcharges?
- Restaurants can apply surcharges UNLESS they are in California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma, or Texas
- Remember: Surcharges are for credit purchases only, not debit or prepaid cards. Also, even if surcharging is illegal, you can still offer discounts for cash or check purchases.
- Yes. If you are thinking about surcharging, you need to reach out to your card association & check with your POS system to make sure they can meet requirements (mPOS such as Square and Papal do not allow for surcharging)
- Some requirements may include limits, notice posted for consumers & notifying card association in advance
- Product-level: Surcharge same for all products; ie: signature rewards cards or commercial cards, etc.
- Brand-Level: Surcharge same for all brands; ie: Visa, Mastercard, AMEX, etc.