What Is A Credit Card Surcharge?
A Credit Card Surcharge is when a merchant charges an additional fee to the purchasers for using Credit Cards. Credit Card surcharges are in contrast to Credit Card fees which are paid by merchants to financial institutions running Credit Card services for allowing their credit cards be used.
What Are The State Laws For Credit Card Surcharges?
Many state laws ban Credit Card Surcharges. Credit card surcharges are not currently allowed in the states of California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York and Oklahoma. Credit card surcharges are currently allowed in the other 44 states.
How Is The Credit Card Surcharge Amount Determined?
The Credit Card Surcharge is often a percentage of the Credit Card purchase price. In the states that allow Credit Cards Surcharges, merchants may charge up to 4% fee for Credit Transactions. This means that if a customer uses a Credit Card to buy a $1 item, they will be charged an additional $0.04 Credit Card Surcharge.
What About Credit Card Transaction Fees?
In the states that allow Credit Cards surcharges, merchants may charge an additional Credit card transaction fee to their customers at a rate of up to 1% of the Credit Card transaction amount. This means that if a customer uses a Credit or Debit Card to buy a $1 item, the Credit Card transaction fee (not Credit Card Surcharge) will be charged at $0.01 Credit Card Transaction Fee.
What About Credit Cards Issued By The Merchant?
A Credit card surcharge is determined based on the Credit cards issued by major Credit card companies such as Visa and MasterCard. Credit Cards issued by the merchant are not subject to Credit Card Surcharges.
What If I Am An International Traveler?
If you are traveling to the United States, Credit Card Transaction Fees and Credit Card Surcharges do not apply to you. This is because major Credit card companies such as Visa and MasterCard prohibit Credit Card Surcharges on Credit Cards issued outside of the United State regardless of whether the Credit Card transaction is in US Dollars or not.
What If I Am A Merchant Running A Brick And Mortar Business?
If you are running a brick and mortar business, Credit Card Transaction Fees and Credit Card Surcharges do not apply to you. Credit Card Surcharges are typically applied to Credit Card transactions that take place online.
What If I Am A Merchant Running An E-Commerce Business?
If you are running an ecommerce business, Credit Card Transaction Fees and Credit Card Surcharges will apply to your Credit Card transactions. Major Credit card companies such as Visa and MasterCard apply Credit Card Surcharges to Credit Cards issued by Credit card companies not located in the United States.
What If I Am A Merchant Running B2B Credit Card Transactions?
Credit Card Transaction Fees and Credit Card Surcharges do not apply to you. Credit Card Surcharges are typically applied to Credit Card transactions that take place online.
What If I Am An Airline?
If you are an airline, Credit Card Surcharges do apply to Credit Cards issued by Credit card companies located outside of the United States. Credit Card transaction fees do not apply to your Credit Card transactions.
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