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Is a Merchant Allowed to Charge Customers Credit Card Processing Fees?

Is a Merchant Allowed to Charge Customers Credit Card Processing Fees?

Q: Can a company charge you a fee for using a credit card?

A company may charge a fee for using a credit card, but this practice is often restricted by credit card processors. If a business does impose such a fee, it could face penalties, including losing the ability to accept credit cards. Always check the specific terms of the merchant's agreement with their processor.

Q: Can you pass credit card processing fees to customers?

Passing credit card processing fees to customers is generally restricted by many credit card processors. If a business does this and is reported, it may lose the ability to accept credit cards. Some businesses try to work around this by adjusting their pricing and offering cash discounts instead.

Q: Is it legal to charge a credit card processing fee?

The legality of charging a credit card processing fee varies based on the terms set by the credit card processor. Many processors prohibit such fees. Violating these terms can result in losing the ability to accept credit cards. It’s important to review your processor's policies before implementing any fees.

Full question:

May a company charge its customers a fee to specifically cover the fees a credit card processor charges it?

Category: Debts and Credit
Date: 04/07/2025
State: Minnesota

Answer:

The answer will depend on the merchant's contract with the credit card company. Many credit card processing companies will not allow a merchant to charge a "fee" to accept a credit card. If the merchant does and a customer reports the merchant to the credit card processing company, the credit card company may not allow the merchant to accept credit cards. They then pass this information along to all the other credit card processors and the merchant may end up not being able to accept credit cards at all. Some companies attempt to get around this by setting prices higher and then offering a "discount" price for payment in cash.

This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.

FAQs

Can I charge my customers a credit card processing fee?

Whether you can charge customers a fee for credit card processing depends on your agreement with the credit card processor. Many processors prohibit such fees. If you impose this charge and a customer reports it, you risk losing the ability to accept credit cards. Some businesses try to avoid this by increasing prices and offering discounts for cash payments.