At a Glance

Credit card surcharges have become a topic of interest and confusion for both consumers and businesses alike. These fees, added to the total purchase amount when paying with a credit card, have raised questions about their legality, regulations, and how to navigate them. Let’s discuss credit card surcharges, their legitimacy, restrictions, and ways to manage them effectively.

In this article, you’ll learn:


1.5% to 3.5%

The average credit card surcharge in the U.S.

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What are credit card surcharges?

Credit card surcharges are additional fees merchants impose when customers pay for their purchases using a credit card. These fees are meant to offset the cost of processing credit card transactions, which can eat into a merchant’s profit margin due to processing fees charged by credit card companies and payment processors.

Are credit card fees legal?

The legality of credit card surcharges varies depending on the jurisdiction and applicable laws. These surcharges are explicitly allowed in some places, while in others, they may be restricted or prohibited. It’s important to note that if surcharges are permitted, there are usually rules and regulations that businesses must adhere to to implement them legally.

Rules and regulations for credit card surcharging

1. Disclose the surcharge fee prior to the transaction

One of the fundamental regulations for credit card surcharges is transparency. Merchants are generally required to inform customers about the surcharge fee before they finalize the transaction. This means the surcharge should be clearly stated and visible to the customer before confirming the purchase.

2. Surcharge must be listed on receipts

In many jurisdictions, if a business applies a surcharge to a credit card transaction, it must include the surcharge amount on the customer’s receipt. This transparency ensures that customers have a record of the additional fee they were charged.

3. Cap of 4% on surcharges

Some regions that permit credit card surcharges impose a cap on the maximum percentage that can be charged as a surcharge. For instance, if the cap is set at 4%, a merchant cannot charge more than 4% of the total transaction amount as a credit card surcharge.

4. No surcharge for debit card

While credit card surcharges might be allowed for certain transactions, it’s important to note that surcharges are often not allowed on debit card transactions. Debit cards are considered a different payment method and may be subject to separate regulations.

How to avoid credit card surcharges?

As a consumer, there are several strategies you can employ to avoid credit card surcharges:

  • Use alternative payment methods: Consider using payment methods that don’t typically incur surcharges, such as cash, debit cards, or mobile payment apps.
  • Negotiate with merchants: In some cases, especially for larger purchases, you might be able to negotiate with the merchant to waive the surcharge.
  • Shop around: Look for merchants that do not impose surcharges or offer discounts for using certain payment methods.

What to do if you incur an illegal credit card surcharge?

If you believe you have been charged an illegal credit card surcharge, it’s important to take the following steps:

  • Gather evidence: Keep your receipt and any other relevant documentation that shows the surcharge was applied.
  • Contact the merchant: Reach out to the merchant to discuss the situation and request a refund of the surcharge if it was charged unlawfully.
  • File a complaint: If the merchant is uncooperative or if you suspect a widespread issue, you can file a complaint with relevant consumer protection authorities.


The maximum allowable surcharge percentage varies by jurisdiction. It’s important to check local laws to determine the specific limits in your area.

While both surcharges and convenience fees are additional charges, they are different. Surcharge fees are specifically related to credit card transactions, whereas convenience fees may be charged for various reasons, like providing additional services or accommodations.

The responsibility for paying credit card fees can vary. Some businesses choose to absorb these fees as a cost of doing business, while others may pass them on to customers. The legality and terms of passing on fees should be carefully considered and understood.