The Surcharging method of credit card processing adds a consumer fee only to credit card purchases – this allows the busienss to offset their credit card processing fees. Though consumers, are still able to avoid the additional fee by paying with a Debit card, Pre-paid card, or cash – all of which incur a lower cost to the business owner than credit card processing fees in all but the smallest transactions.
How Do I Implement Surcharging?
There are multiple steps required to offer surcharging method of card processing and remain compliant with the Credit Card companies requirements. First off you will need to enter into a new processing agreement, second you will need to provide Visa & Mastercard etc with a 30 day advance notice. After that you will need to post signage at the entrance to your business and also at each point of sale. Lastly your business must be in a state which permits surcharging – which Minnesota does allow.
Is Surcharging Right For My Business?
The most popular processing method today is Cash discount as it applies to all card types and not just credit cards and is simpler to implement. Some business’ however prefer to have an option where customers can avoid the fee, thus they can opt to use their debit card instead; which in most cases is the least costly option for the business owner. Another scenario is a healthcare business, such as a dentist, optometrist, or chiropractor where Health Savings accounts are used and their issuer may not allow a service fee. Additionally since the customer may have no choice but to use their HSA account the business owner may also be reluctant to offer Cash Discount processing, this choosing to opt for Traditional processing and taking on the full cost of processing. Contact Merchant Partner for more information