New York Credit Card Surcharge Mandate Goes Into Effect

A law legalizing credit card surcharges went into effect on Sunday, Feb. 11, in New York State. This law allows business owners to collect a surcharge from customers who choose to pay for their purchase with plastic.

Businesses have the option of passing on the actual cost of credit card processing fees as a surcharge to customers, but they must be transparent ahead of the transaction by posting the highest total price (before sales tax is added) on each item. All businesses are required to include their surcharge in the listed price, posted before checkout.

Under the new requirements, businesses can’t simply post a sign on the door or at the register stating that there is an additional 3.9% surcharge for credit cards. They have to make it clear for each item what the surcharge is.

Along with the listed price, businesses can have a “cash price.” However, businesses can also choose to charge all of their customers the credit card price, according to WBFO.

New York Governor Kathy Hochul signed this new legislation in December 2023. To ensure businesses follow this new law, if violated, they could be guilty of a misdemeanor, which could lead to a fine of upwards of $500 or up to a year in prison.

“New Yorkers should never have to deal with hidden credit card costs, and this law will ensure individuals can trust that their purchases will not result in surprise surcharges,” Governor Hochul said in a statement. “Transparency is crucial in building trust between businesses and communities and now patrons will be empowered to budget accordingly.”

If consumers experience any issues related to credit card pricing at the register, the DCP recommends customers either file a complaint with the DCP to receive a refund or file a complaint with the New York Attorney General or participating local governments for enforcement of a business that they believe violated the law.

The law does not apply to purchases made with debit cards.