When Retailers Can Charge You Extra for Using a Credit Card

Retailers can charge a credit card fee in most states, but the rules depend on which card you use and what type of business you're dealing with

The short answer: yes, many retailers can add a fee when you pay with a credit card. But the rules are not the same everywhere, and some cards have stronger protections than others. Visa and Mastercard have their own rules about when merchants can charge fees, separate from state law. American Express and Discover have different policies. Gas stations, restaurants, and online stores all operate under slightly different rules.

The fee itself is not hidden — the retailer must tell you the amount before you complete the purchase. You can then choose to pay a different way if you want to avoid it. But knowing which cards are protected, which states limit fees, and when a retailer is breaking the rules can save you money and help you push back if you're charged unfairly.

Key Takeaways

• Visa and Mastercard prohibit retailers from charging fees on credit cards, but American Express and Discover allow it in most situations.
• Some states including California, New York, and Texas ban credit card surcharges entirely, while others allow them with no limit on the amount.
• A retailer must disclose the fee before you pay, and the fee cannot exceed the actual cost the business pays to accept that card.
• Gas stations and online retailers have different rules than brick-and-mortar stores, and some businesses like nonprofits and government agencies face additional restrictions.

Visa and Mastercard rules protect you from most credit card fees

Visa and Mastercard have contractual rules that forbid their member retailers from charging a surcharge — an extra fee — when you use their credit cards. This rule applies to almost every store, restaurant, and online retailer that accepts Visa or Mastercard. The rule does not apply to debit cards, prepaid cards, or other payment methods.

If a retailer charges you a fee for using Visa or Mastercard, they are violating their agreement with the card network. You can report this to Visa or Mastercard directly through their websites. The card networks take these complaints seriously because they want to protect their brand reputation and keep customers using their cards.

However, this protection only covers Visa and Mastercard credit cards. If you use an American Express or Discover card, the rules are different, and the retailer may be allowed to charge a fee.

American Express and Discover have different policies

American Express and Discover do not prohibit retailers from charging fees for using their cards. This means a business can legally add a surcharge when you swipe an Amex or Discover card, even in states where Visa and Mastercard fees are banned. The fee still must be disclosed before you pay, and it cannot exceed what the business actually pays to process the card.

In practice, fewer retailers charge fees for Amex and Discover than for other cards, partly because these card networks have smaller merchant bases and customers are more likely to walk away. But the legal permission is there, and some high-fee businesses like gas stations or convenience stores do use it.

State laws that ban credit card surcharges entirely

A handful of states have passed laws that prohibit retailers from charging any surcharge on credit cards, regardless of which card network it is. These states include California, New York, Texas, Florida, Oklahoma, and a few others. The laws vary slightly — some apply only to in-person purchases, others cover online transactions too.

If you live in one of these states, a retailer cannot charge you a fee for using any credit card, even an American Express or Discover card. If they do, you can file a complaint with your state's attorney general or consumer protection office. Check your state's attorney general website to see whether your state has a surcharge ban.

States without a surcharge ban allow retailers to charge fees on American Express and Discover cards, though Visa and Mastercard rules still protect those two networks.

Gas stations and online retailers operate under different rules

Gas stations have a special exemption in Visa and Mastercard rules. They are allowed to charge a surcharge for credit card purchases at the pump, though they must post the fee clearly at the pump and at the entrance. This exemption exists because gas stations historically had very thin profit margins and high credit card processing costs. If you pay inside the station instead of at the pump, the surcharge rules may not apply.

Online retailers can charge fees on American Express and Discover cards in most states, but Visa and Mastercard rules still apply. Some online retailers try to work around this by calling the fee a "convenience charge" or "processing fee" instead of a surcharge, but the name does not change the rule — if it is tied to your choice of payment method, it is a surcharge and is subject to the same restrictions.

How to know if a retailer is charging you illegally

A retailer is breaking the rules if they charge a fee on a Visa or Mastercard credit card in any state, or if they charge any fee on any credit card in a state with a surcharge ban. They are also breaking the rules if the fee exceeds what they actually pay to process the card — typically 2 to 4 percent, though it varies by card type and business size.

The retailer must also disclose the fee before you complete the purchase. If you see a fee added after you have already paid, or if the fee was not clearly stated before checkout, that is a violation. Online, the fee should appear on the checkout page before you enter your payment information. In a store, it should be posted at the register or on signage visible before you swipe your card.

If you believe you have been charged illegally, take a photo of the receipt and the signage (if any), note the date and time, and contact your credit card company. They can dispute the charge on your behalf. You can also file a complaint with your state's attorney general or the Federal Trade Commission.

Nonprofits and government agencies have stricter limits

Nonprofits and government agencies face additional restrictions on credit card fees. Many states prohibit these organizations from charging any surcharge at all, even on American Express or Discover cards. This rule exists because nonprofits and government agencies are considered to serve the public interest and should not add costs to transactions.

If you are paying a utility bill, property tax, or donation to a nonprofit and see a credit card fee, check your state's rules. Some states allow a small fee only if the nonprofit or agency can prove it covers their actual processing costs, and even then the fee is often capped at a lower percentage than what a retail store can charge.

Frequently Asked Questions

Can a retailer charge different fees for different credit cards?

Yes, they can charge different amounts for American Express versus Discover, or charge nothing for Visa while charging for Amex. However, the fee cannot exceed their actual processing cost for that specific card, and Visa and Mastercard rules still apply to those networks. Some states also prohibit this practice entirely.

What if the fee is called something other than a surcharge?

The name does not matter. If the fee is tied to your choice of payment method — whether it is called a surcharge, convenience fee, processing fee, or service charge — it is subject to the same rules. A fee that applies to all payment methods equally (like a checkout fee for online orders) is different and may be allowed.

Can I dispute a credit card fee with my bank?

Yes. Contact your credit card issuer and explain that you were charged a fee that violates Visa or Mastercard rules, or your state's surcharge ban. They can dispute the charge and often reverse it. Keep your receipt and any photos of signage as proof.

Do I have to pay the fee, or can I refuse?

You can refuse and pay another way. The retailer must disclose the fee before you complete the purchase, so you have the chance to use a different payment method or go elsewhere. If the fee was not disclosed until after you paid, you have grounds to dispute it.

What states ban credit card surcharges?

California, New York, Texas, Florida, and Oklahoma have statewide bans. A few other states have partial bans or restrictions. Check your state attorney general's website to confirm your state's rules, as laws change and vary in scope.