Can A Business Charge for Accepting a Credit Card for Payment?

Customers sometimes ask if EstateMAX charges for their use of credit cards? NO we don’t but the banks do. So ask your bank. Get educated about how money works.

EstateMAX gives a cash discount for customer’s using credit or debit cards.

As always, Cash is king and at estate sales where customers are paying pennies on the retail dollar they should show up with cash and not demand we pay their credit card fees.

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If you regularly use a card at checkout, you may have encountered an added service fee for paying with your card. While businesses were not allowed to charge fees for paying with plastic in the past, updated rules allow companies to add a surcharge or fee when customers use a card for payment.

Keep reading to learn how businesses can charge extra when using a credit card.

What are credit card processing fees?

Businesses must pay a modest credit card processing fee whenever a customer makes a card-based payment. Fees are often around 1% to 3% of the transaction amount, which merchants pay to their credit card processor. So, for example, when you make a $100 purchase at a local restaurant or store, the seller only gets about $97 to $99, with the remainder going to credit card processing fees.

Fees are divided between the card network (Visa, Mastercard, American Express and Discover, for example), the merchant’s processor (such as SquareStripePayPal and major banks) and potentially other companies involved in transaction processing.

Understanding surcharges vs. convenience fees

You may come across convenience fees and surcharges when shopping online or in person. While it’s never fun to pay extra, understanding how these fees work may help you avoid or better control them.

Convenience fees are add-on charges related to extra services. For example, if you buy a movie ticket online or by phone through a third-party service, the third party can charge a convenience fee. If you’ve bought concert tickets through a service like Ticketmaster, you’re likely very familiar with convenience fees. If a business normally accepts cash payments, they may add a convenience fee for credit card sales.

Surcharges are add-on charges that help companies to recoup the higher cost of a credit card transaction. If a business adds a surcharge to credit card payments, it’s to offset the 1% to 3% fee they’re likely paying for credit card processing.

Note: In place of surcharges, some businesses require a certain minimum purchase amount for card-based payments to ensure they earn enough to cover the added costs.

How much are typical credit card transaction fees?

When you go to the register in most states, you shouldn’t be shocked to see a surcharge added to your purchase. Surcharges vary based on the location and merchant.

Before 2013, surcharges were generally nonexistent. After a class action lawsuit against Visa and Mastercard, businesses won the right to mark up card-based purchases to help cover their added costs. Surcharges may be up to 4% of the purchase at most but are often around 2% to 3%, in line with the seller’s processing fees.

At gas stations, you may have noticed some sellers mark up purchases by $0.05 or $0.10 per gallon when paying by card. They may call the cash price a discount, but regardless, you’ll pay more at some gas stations when paying with a debit or credit card because of the surcharge.

State or local governments may regulate credit card transaction fees. We’ll break down which states allow surcharges and which prohibit or limit them below.

Credit card surcharges are legal unless otherwise prohibited by state or local law. Certain states have specific disclosure requirements, while others limit what businesses can add as a credit card surcharge.

While laws can change at any time, only 10 states currently impose some type of restriction or disclosure requirement on credit card surcharges. Connecticut, Maine, Massachusetts and Oklahoma prohibit or limit surcharges.

Credit card surcharge legality across the U.S.

Federal court cases regarding surcharge legality may override state laws in some situations. Here’s a glance at states with laws that restrict or prohibit card surcharges.

Alabama No restriction
Alaska No restriction
Arizona No restriction
Arkansas No restriction
California Restricted Illegal according to state law but reversed by court case
Colorado Restricted Surcharges are limited to 2% or the actual cost
Connecticut Restricted Surcharges are prohibited. Cash discounts are allowed
Delaware No restriction
District of Columbia No restriction
Florida Restricted Convenience fees allowed up to the cost incurred by the seller
Georgia Restricted Convenience fees are only allowed when alternate payment methods are available without a fee. Fees must be clearly disclosed. Fees can’t be more than the merchant’s cost
Hawaii No restriction
Idaho No restriction
Illinois No restriction
Indiana No restriction
Iowa No restriction
Kansas Restricted Surcharges are limited by state law
Kentucky No restriction
Louisiana No restriction
Maine Restricted Surcharges are prohibited, except in the case of government entities, which must clearly disclose the amount prior to payment and cannot exceed the cost incurred by the government for the transaction
Maryland No restriction
Massachusetts Restricted Surcharges are prohibited
Michigan No restriction
Minnesota Restricted Surcharges must be clearly disclosed and may not exceed five percent of the purchase price
Mississippi No restriction
Missouri No restriction
Montana No restriction
Nebraska No restriction
Nevada No restriction
New Hampshire No restriction
New Jersey No restriction
New Mexico No restriction
New York Restricted Cash and card prices may be used if clearly disclosed
North Carolina No restriction
North Dakota No restriction
Ohio No restriction
Oklahoma Restricted Surcharges limited to 2%. Disclosures are required
Oregon No restriction
Pennsylvania No restriction
Puerto Rico Restricted Surcharges are not permitted
Rhode Island No restriction
South Carolina No restriction
South Dakota No restriction
Tennessee No restriction
Texas Restricted Only government entities are allowed to add surcharges
Utah No restriction
Vermont No restriction
Virginia No restriction
Washington No restriction
West Virginia No restriction
Wisconsin No restriction
Wyoming No restriction

Credit card fee rules and regulations

If you run a small business and want to set credit card surcharges, it’s important to take several steps. Those include:

  • Research state laws and regulations.
  • Check rules and limitations with your credit card processor.
  • Notify the processor of planned surcharges if required.
  • Create signage or disclosures notifying customers if required by state law.
  • Train employees to disclose surcharges orally if required by state law.

Do payment processors handle surcharges?

Check with your payment processor to learn more about how surcharges work. In some cases, you need to add the surcharges in your sales or credit card processing systems. In others, you may have to work with the processor to have them adjust your sales to include the surcharge.

Check out our list of the best payment processing companies to learn what to expect when working with different credit and debit card processors.

Frequently asked questions (FAQs)



Cash discounts are not the same as credit card surcharges. Credit card surcharges are prohibited in some states, but cash discounts may be allowed.



Blueprint is an independent publisher and comparison service, not an investment advisor. The information provided is for educational purposes only and we encourage you to seek personalized advice from qualified professionals regarding specific financial decisions. Past performance is not indicative of future results.

Blueprint has an advertiser disclosure policy. The opinions, analyses, reviews or recommendations expressed in this article are those of the Blueprint editorial staff alone. Blueprint adheres to strict editorial integrity standards. The information is accurate as of the publish date, but always check the provider’s website for the most current information.

Eric Rosenberg

Eric Rosenberg


Eric Rosenberg is a financial writer, speaker, and consultant based in Ventura, California. He is an expert in topics including banking, credit cards, investing, cryptocurrency, insurance, real estate, and business finance. He has professional experience as a bank manager and nearly a decade in corporate finance and accounting. His work has appeared in many online publications, including Business Insider, Nerdwallet, Investopedia, and U.S. News & World Report.

Bryce Colburn

Bryce Colburn


Bryce Colburn is a USA TODAY Blueprint small business editor with a history of helping startups and small firms nationwide grow their business. He has worked as a freelance writer, digital marketing professional and business-to-business (B2B) editor at U.S. News and World Report, gaining a strong understanding of the challenges businesses face. Bryce is enthusiastic about helping businesses make the best decisions for their company and specializes in reviewing business software and services. His expertise includes topics such as credit card processing companies, payroll software, company formation services and virtual private networks (VPNs).

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