Merchant Services
Credit Card Surcharges: "Cash or Credit" Takes on New Meaning

Credit Card Surcharges: "Cash or Credit" Takes on New Meaning

In one of the largest antitrust settlements of its kind, merchants may add a surcharge for certain credit card transactions, effective January 27, 2013. However, merchants who elect to surcharge customers must follow appropriate disclosure and other requirements agreed to as part of the settlement.

Yes or No?
The decision on whether or not to add a surcharge to credit card transactions is ultimately a business decision. For example, you may wish to maintain competitive pricing or simply avoid creating a negative customer experience by assessing a surcharge at checkout. If that's the case, proceed as you always have.

But if you do decide to add a surcharge at checkout, you'll need to follow some very specific rules, including these:

Notify Visa/MasterCard. Merchants are required to notify Visa, MasterCard and their acquirer 30 days prior to surcharging. You can satisfy this requirement by going to the following websites and following the instructions for:

  • Notification of Intent to Surcharge:
  • Merchant Registration with MasterCard and Acquirer:

Apply it properly. The surcharge applies only to credit card purchases. You cannot add a surcharge to debit and prepaid card transactions.

Check your state. Make sure you are not doing business in a state that currently restricts surcharging:

  • California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma, Texas

Every state is evaluating this topic and more are contemplating restricting surcharges. Be sure to double check your state's policy.

Charge the proper amount. Merchants can assess a surcharge on credit card purchases that does not exceed the merchant discount rate for the applicable credit card surcharged*. However, in no event can you assess a surcharge in excess of 4%. More information can be found at

Tell your customers. You'll need to clearly alert customers that you are assessing a surcharge. Disclosures must be prominently displayed at the point of entry and point of sale - both in-store and online. Finally, the surcharge amount must be itemized and identified separately on the transaction receipt.

Have Questions?
The information provided is just a sample of the requirements you'll need to consider.
Visa and MasterCard have posted detailed information on their respective websites, including a full summary of specific requirements.

If you still have questions after visiting the Visa and MasterCard websites, feel free to call a PNC Merchant Services Customer Service Representative at (800) 742-5030.

*In cases where the applicable merchant discount rate exceeds 4% of the underlying transaction amount, in no event can the merchant assess a surcharge above 4%.


PNC is a registered mark of The PNC Financial Services Group, Inc.("PNC")

Visa is a registered trademark of Visa International Service Association and used under license; MasterCard is a registered trademark of MasterCard International, Inc.

This Merchant Business Insights e-Newsletter is designed to provide useful and practical information for merchants accepting card transactions. It is not intended to be legal, tax, accounting or financial advice, nor should it be substituted for a full and regular review of the Association Rules and any changes thereto. Internet sites provided in this e-Newsletter are provided as a convenience to our readers. While PNC Merchant Services endeavors to provide resources that are reputable and safe, we are not responsible for the information, products, or services obtained on such sites.