What is Surcharge?

A surcharge is an additional fee added to a sale when a customer chooses to pay with a credit card. This allows you to continue accepting credit cards without bearing the full cost of credit card processing.

For example, if your posted price is $100 and you apply a 3% surcharge, a customer who pays with a credit card would be charged $103.

Here are some of the key benefits:

• Preserve your profit margins: by offsetting processing costs, you keep more of your revenue instead of losing a portion to card fees.
• Offer more payment options without penalty: surcharging lets you offer credit card payments without penalizing your bottom line.
• Encourage alternative payment methods: some customers may choose to pay with debit, cash, or other non-credit methods to avoid the surcharge, thus helping you lower processing costs even further.
• Simple to understand and implement: with the right support from your payment processor, a compliant surcharge program can be set up easily, with clear signage and receipt formatting.

You can charge up to 3% either of the transaction amount or of your actual cost of processing, whichever is lower. Charging above this limit violates card brand rules.

Your terminal or POS must be properly programmed to calculate and apply the surcharge automatically only to credit card transactions. Manual entry is not compliant.

Can I surcharge debit or prepaid cards?

Card brand rules strictly prohibit surcharging any transaction processed with a debit or prepaid card, regardless of how the card is run. This includes both PIN-based and signature-based debit transactions.

If a surcharge is applied to a debit or prepaid card, this can result in non-compliance, cardholder complaints, and potential fines from the card brands.

To ensure compliance:

• Your terminal should be properly set up to automatically detect card types and apply surcharges only to eligible credit card transactions.
• Regularly review your surcharge settings and test transactions to make sure debit cards are not being incorrectly surcharged.

If you’re unsure whether your equipment is set up correctly, reach out to your service provider or the Paysafe support team for assistance.    

Do I need to notify the card brands?

Yes, if you plan to implement a surcharge program, you must notify the card brands before you begin.

MasterCard requires that you submit a notification at least 30 days in advance of implementing a surcharge. This step is essential to remain compliant with card brand regulations. To register with MasterCard, visit MasterCard Surcharge Disclosure Link to Register