Credit Card Surcharge Rules: A State-by-State Guide for Merchants

Credit card surcharging — passing the cost of card processing directly to customers who pay by card, is legal in most of the US but regulated differently in each state. Get it wrong and you face card network fines and potential state legal liability. Get it right and you can meaningfully reduce or eliminate your card processing costs. This guide covers what you need to know to implement surcharging legally on your WooCommerce store.

1. What Is Credit Card Surcharging?

A credit card surcharge is a fee added to a transaction when a customer pays by credit card, covering some or all of the merchant’s processing cost. Surcharging is:

• Added at the point of sale (online checkout or in-person)
• Applied only to credit card transactions — not debit cards, prepaid cards, or other payment methods
• Disclosed to the customer before transaction completion
• Limited to the merchant’s actual cost of acceptance (capped at 3% for Visa; 4% for Mastercard)

Surcharging is different from a “convenience fee” (a fixed fee for using a specific payment channel, like online bill payment) and from “cash discount” programs (a discount for cash customers rather than a surcharge for card customers, with different regulatory treatment).

2. Card Network Surcharging Rules

Both Visa and Mastercard have specific surcharging rules that apply globally. Key requirements:

Visa Surcharge Rules

• Maximum surcharge: 3% of the transaction amount (reduced from previous limits)
• Must register surcharge program with Visa at least 30 days before implementation
• Must disclose surcharge at point of entry and point of sale
• Cannot surcharge debit cards, even if they run on the Visa network
• Surcharge must not exceed your cost of acceptance

Mastercard Surcharge Rules

• Maximum surcharge: 4% of the transaction amount
• Must register with Mastercard before implementing
• Disclosure required at point of entry and point of sale
• Cannot surcharge debit cards
• Must apply equally to all Mastercard credit cards (no targeting specific card types)

Violation of card network surcharge rules can result in fines from the card network and potential loss of card acceptance privileges.

3. State-by-State Surcharge Legality

State surcharging laws have been in flux since the 2013 Supreme Court ruling in Italian Colors Restaurant v. Harris — which found California’s anti-surcharging law potentially unconstitutional and subsequent state and federal court decisions.

Important note: State laws on surcharging change. The above reflects the general landscape as of mid-2026 but should be verified against current state statutes and your legal counsel before implementation.

4. Disclosure Requirements

Both card networks and most states require disclosure of the surcharge before the customer completes the transaction. For WooCommerce online stores:

• Checkout page disclosure — the surcharge amount or percentage must be displayed clearly on the checkout page before the customer submits payment
• Cart/order summary disclosure — the surcharge should appear as a line item on the order summary
• Receipt/confirmation disclosure — the surcharge must appear on the transaction receipt
• Signage for physical locations — if you also have in-person locations, card network rules require physical signage at the store entrance and point of sale

Surcharges that are only disclosed in fine print or discovered after the transaction is complete are non-compliant.

5. Surcharging vs. Cash Discount Programs

Cash discount programs offer a lower price for cash payment rather than adding a surcharge for card payment. The distinction matters because:

• Cash discounts are legal in all states, including Connecticut and Massachusetts where surcharging is prohibited
• Cash discounts don’t require card network registration
• The framing matters: “List price is $100; we offer a 3% discount for cash payment” is a cash discount; “List price is $97; credit card customers pay an additional 3%” is a surcharge

Some processors market cash discount programs specifically for merchants in surcharge-prohibited states. The FTC has scrutinized some implementations of these programs where the “cash discount” framing is pretextual, so the distinction must be genuine.

6. Implementing Surcharging on WooCommerce

To implement surcharging on WooCommerce:

1. Verify state legality for all states you ship to — if you sell to Connecticut or Massachusetts, you may need to exclude those customers from the surcharge
2. Register with Visa and Mastercard — at least 30 days before implementing. Your processor facilitates this registration.
3. Configure WooCommerce — use a WooCommerce surcharge plugin or your payment gateway’s built-in surcharging feature to add the surcharge dynamically at checkout
4. Implement proper disclosure — ensure the surcharge displays as a line item in the cart and checkout, and appears on receipts
5. Set the correct rate — cannot exceed your actual cost of acceptance; maximum 3% for Visa, 4% for Mastercard; use the lower limit if accepting both

ConvesioPay supports surcharging implementation for eligible merchants with proper card network registration and WooCommerce checkout configuration.