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Recently when paying for a pricey plumbing project with down California's ban on surcharging. And the U.S.
my credit card I was told there would be a 4 percent fee Supreme Court last year struck down a lower court ruling
to cover card processing. While I said I understood, I that upheld New York's surcharge ban, asserting that the
counseled the plumber not to present it that way to other prohibition impeded merchants' free speech rights. That
customers lest it land him in hot water with Visa and case was sent back to an appeals court for reconsideration.
Mastercard. He was genuinely surprised to learn what he
was doing was covered by card brand rules. Given the Supreme Court's ruling, most experts expect all
state prohibitions on surcharging will eventually fall by
By coming down on current cash discount program the wayside. With them, I believe, will fall many of the
arrangements, Visa appears to be compelling merchants negative connotations associated with surcharging.
who want to recoup costs to implement surcharging
programs and risk a backlash from consumers who like By putting the kibosh on cash discounting, Visa may have
getting discounts but bristle at the thought of paying hoped merchants would fear alienating cardholders with
surcharges. But that's not the only potential drawback. explicit fees (that is, surcharges). But most consumers
Surcharges can only be applied to credit card purchases understand that there's a cost to businesses for accepting
(not debit or prepaid card purchases), and are generally credit cards, and most are accustomed to paying service
capped at 4 percent of the ticket. Plus any merchant fees, for everything from accessing cash at ATMs to
implementing surcharging must pre-notify the card home delivery of food and liquor. Paying a fee for the
brands. convenience of paying with a credit card, I suspect, isn't
going to be seen as a major hardship for most consumers.
Surcharging bans in question Those that don't want to pay the fees can always carry
Then there are the laws in 10 states banning surcharging, more cash, and if necessary make more trips to ATMs.
including large states like California, Florida,
Massachusetts, New York and Texas. The future of these Patti Murphy is Senior Editor at the Green Sheet and President of
state bans is in question, however. A federal court struck ProScribes Inc. Follow her on Twitter @GS_PayMaven.

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