Merchant Minute: January


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A topic that is being talked about more frequently in the Credit Card Processing industry is Credit Card Surcharging. Credit Card Surcharging is an additional fee that a merchant adds to a consumer’s bill when he or she uses a credit card for payment.

Although most businesses would benefit from the additional fee charged on credit card payments, there are drawbacks/risks associated with doing so. Studies show consumers overwhelmingly responded that they would not be willing to pay fees to use a credit card. Another factor to consider is whether or not your competition is surcharging. If the competition is surcharging, maybe holding off will draw more business to you. Surcharging does come with rules and regulations, some of which will be explained below.

The merchant must clearly display at the Point of Sale, or checkout, that they are surcharging. Every receipt must also disclose the surcharge dollar amount. Debit cards are not allowed to be surcharged regardless if it is run as credit or debit, only true credit cards can be surcharged. Another important piece of information to note is the surcharge amount cannot exceed the fee the merchant is charged to process a credit card payment.

There are many factors to weigh in deciding whether or not to surcharge. The best recommendation we have is to stay informed. Feel free to contact us here at Citizens State Bank with questions, otherwise there is an abundance of quality information out there on the topic, including great articles from the VISA and Mastercard websites.