Visa and MasterCard will begin allowing merchants in some states to levy a surcharge on credit card payments to help them recoup the credit card swipe fees they pay. Merchants had previously been prohibited by Visa and MasterCard from charging consumers a surcharge when they used a credit card, although the companies signaled they would drop the ban following the settlement of a class-action lawsuit dealing with the issue.
Although merchants will now be able to levy surcharges on credit card transactions, they will have to comply with a number of requirements in order to do so. For example, Visa says the surcharges will be applicable only to credit card transactions, not debit card transactions. In addition, surcharges must be applied equally to all card brands. Surcharges also cannot be more than the cost of the processing the transaction or 4 percent, whichever is less. Merchants in some states may not be able to levy the surcharges at all, as several states have laws in place banning such charges.Back To Blog