Merchants Surcharging
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credit card transaction fees

Surcharging Made Simple

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What to Know Before You Add a Surcharge

Adding a surcharge to credit card transactions might sound like a simple way to offset fees—but in practice, it’s anything but simple. Strict state laws, card brand rules and compliance requirements can make it hard to know what’s allowed (and what’s not).

That’s where Basys comes in. We’ll help you navigate the fine print and set up a compliant program that works for your business—so you can reduce costs without adding stress.

Simplify Surcharging with Basys

Real Support
With 20+ years of experience, we know how to guide business owners through complex payment decisions—without the jargon.
Recover Costs
We’ll help you meet all the requirements to pass credit card fees to your customers compliantly and confidently.
Explore Options
Surcharging isn’t right for everyone. If it’s not the best fit, we’ll walk you through other cost-saving strategies that
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Recover Your Credit Card Fees

Basys helps you understand the rules, stay compliant and implement a surcharge program with confidence.

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How Credit Card Surcharging Works

If your business runs on thin margins—or processes a high volume of small credit card payments—adding a surcharge can help recover processing costs.

Surcharges can only be applied to credit card transactions (not debit), and there are rules to follow: you’ll need to notify card brands 30 days in advance and clearly post signage at both the point of entry and point of sale.

It’s also worth considering how your customers may respond. Surcharging isn’t right for every business, and we’ll help you weigh the pros and cons based on your goals and customer experience.

Frequently Asked Questions

In most states, yes—credit card surcharges are legal, but there are important rules to follow. The practice became legal in 2013 after a settlement between US merchants and major card brands like Visa and Mastercard. Today, those brands must allow surcharging—but they can still enforce specific requirements, like how and when it’s applied.

However, some states don’t allow surcharging at all. As of early 2021, surcharging is banned in:

  • Connecticut

  • Massachusetts

If you’re unsure whether surcharging is permitted in your state, it’s a good idea to check with your state’s Attorney General or a legal advisor familiar with local business laws.

Start by calculating your effective rate—that’s your total monthly credit card processing fees divided by your total credit card sales. This number gives you a clearer picture of what you’re actually paying to accept credit cards.

Most surcharge programs use a fixed rate between 3.5% and 4%. But if your effective rate is lower than that, you could end up charging your customers more than you’re paying in fees—which can lead to compliance issues and unhappy customers.

Keep in mind: your surcharge can’t exceed the actual cost of accepting that card brand, and caps may apply depending on the card type. Not sure what’s best? We’ll walk you through it.

If you’re planning to add a surcharge, using a compatible POS system makes it much easier to stay compliant and consistent. All Clover terminals support surcharging, along with select other devices.

Basys-supported equipment that works with surcharging includes:

  • iQ Pro

  • Clover Station Duo

  • Clover Station Solo

  • Clover Mini

  • Clover Flex

  • Clover Go

Just a heads up: surcharges can’t be applied to debit card transactions, only credit.

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