Surcharge

is an extra fee a merchant charges the customer to cover part or all of the credit card processing fee paid to card networks.
This lets the merchant recover the cost of acceptance.

✅ Purpose:
Reduce the merchant’s cost burden by passing on card processing fees.

✅ Structure:
Transaction amount × surcharge rate (e.g., 2.5%–3.0%)

✅ When applied:
Notified at the payment approval stage, then added.

⚠ Note:
A surcharge is an added cost paid by the customer on top of the purchase amount.

Follow California Law & Card rules!

✅ California Law

• Menu prices must reflect cash payment amounts.
• Surcharge must be clearly shown on receipts and payment screens.

✅ Major Card Brand Rules

• Visa: Only actual processing costs can be passed; capped at 3%.
• Mastercard: Allowed for cost recovery; must notify at least 1 month in advance.
• American Express: Generally prohibits surcharges.

⚠ Bottom Line:
Surcharge cannot exceed 3%.

Illegal & wrong advertising cases

• Advertising surcharges over 3% (e.g., 3.5%, 4%)
   → This is not a compliant surcharge program.
• Claiming surcharge reduces card fees to $0
   → False! Debit and Amex cards are excluded, so $0 is impossible.

⚠ Beware of exaggerated or false advertising!
Violations can result in fines of $1,000 per incident.