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Surcharging information

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What is surcharging?

A surcharge is a fee you add to your customer's bill when they are using a credit card for payment to cover your merchant account costs/expenses.

  • Before you begin, be sure to review all Helpful Links on our Surcharging Rules & Regulations page. 
  • Surcharging is allowed on card present and card not present transactions.
  • The fee is almost always a percentage of the sale. A flat fee can be charged as long as it does not exceed the merchant's cost of acceptance and never exceeds 3% of any credit card sale. (Note: Ensuring this cap is not exceeded makes the flat fee model extremely difficult to administer.)
  • A surcharge can be applied to credit cards only, not debit.
  • You must disclose your surcharge policy at the checkout page or point of store entry and at the point of sale prior to completion of the purchase transaction. The policy must state the surcharge is not greater than the merchant's cost of acceptance. Clear, consistent, and prominent disclosure is required so the font can be no smaller or less prominent than surrounding text on signage.
  • The surcharge amount must be included in the total transaction amount on the receipt, however, the surcharge amount must be itemized on the details of the receipt.
  • In the event of purchase returns, the full amount of the purchase including the full surcharge amount must be returned to the cardholder. In the event of a partial return, the proportional amount of the original surcharge must be returned to the cardholder.
  • State and/or local laws supersede card brand rules. Surcharges are only permitted on credit cards where not prohibited by law. Merchants are responsible for determining whether their practices comply with state and local law. For example, surcharging is legally prohibited in some states and some state laws limit the surcharge amount beyond standard card brand limits. It is important to be mindful of state laws and seek legal counsel to ensure you are in alignment with your own state requirements.
  • The amount of the surcharge can be no more than the cost of acceptance and no more than 3%, whichever is lower.
  • Merchants must register with MasterCard prior to surcharging. Click here for the online registration form. Visa, Discover and American Express do not require registration. 

In addition to the regulations listed above, it is important to consider the potential impact to the customer experience and what your competitors are doing before making a final decision on whether to move to a surcharging pricing model.

How is a Convenience Fee different from Surcharging?

A convenience fee is a charge passed on to customers for using an alternate form of payment that is not standard to the business offering a product or service. For example, a business can state they accept cash or check only, but offer the convenience of paying with a credit card. A convenience fee cannot be applied to in-person sales so it is typically only assessed on internet and over-the-phone transactions.

  • Allowed only on card not present transactions.
  • Added to payment methods offered as an alternative to normal payment channels.
  • Flat or fixed amount.
  • Applicable to all forms of payment.
  • Disclosed prior to completion of the sale so the customer can cancel the transaction.
  • Included in the total sale amount.
  • Allowed on both credit and debit cards.
  • Service fees are a specific type of convenience fee that come with specific rules and regulations and can only be assessed on certain merchant category codes.