SURCHARGING FAQ – PART 2

If surcharging confuses you, you aren’t alone! Until recently, ambiguity about surcharging has caused a bunch of confusion in the payment processing industry. The good news is, due to litigation in 2012, merchants can surcharge transactions done with credit cards. As a merchant, it’s important for you to understand how surcharges work. At Impact Payment Systems, we know our services are foundational to your business, and we take that responsibility very seriously. Let us share some of our knowledge with you!

In our last blog. we discussed surcharge basics, including the two different types, brand level and product level. Today, we want to look more closely at these two levels and share the general rules around them.

BRAND LEVEL SURCHARGE RULES

Remember, this surcharge blankets transactions done with specific credit card brands (e.g. Mastercard or Visa).

  • No surcharge can go over 4% at any time.
  • It doesn’t matter who issued the credit card; the surcharge must be identical for all credit card transactions of an individual brand.
  • If you accept more than one brand of credit card, you have to meet additional requirements.
  • The surcharge can’t be greater than your average discount rate for that particular brand of credit card.

PRODUCT LEVEL SURCHARGE RULES

This surcharge blankets transactions done with specific credit card products (e.g. Visa Signature Preferred, Visa Signature).

  • No surcharge can go over 4% at any time.
  • It doesn’t matter who issued the credit card; the surcharge must be identical for all credit card transactions of an individual product.
  • If you accept more than one credit card product, you have to meet additional requirements.
  • The surcharge can’t be greater than your average discount rate for that particular brand of credit card. On top of this, you have to subtract the regulated debit interchange rate.

Making sure you’re following regulations is one of the best ways to make your business stronger. Let us further your goals with the best credit card processing and beyond. We are here to give you the tools you need to grow and thrive. Learn more today!