Navigating Credit Card Fees in New York: Unraveling the Confusion
In the complex landscape of credit card processing fees in New York, understanding the permissible practices for passing on costs to customers can be challenging. This one-pager aims to provide clarity, drawing on information from the New York State Division of Consumer Protection.
Key Points:
- Credit Card Surcharges: It is prohibited for businesses in New York to advertise a price and add a surcharge at the point of sale when a consumer opts for credit card payment. Instead, businesses must inform consumers of the higher credit card price by posting it. Discounts for cash payments are allowed.
- Debit Card Fees: While credit cards enjoy protection, surcharges or higher fees for debit card usage are permissible. Clear disclosure at advertised street signage or prominent retail location placement is mandatory.
The following illustrates common New York consumer transactions:
| Examples | Credit Card | Debit Card |
| Percentage Fee: Phil goes into his local Lumber Yard to pick up some 2x4s. He sees a sign that says, “credit or debit card purchases will incur a 5% fee.” | Violation | Compliant |
| Additional Charge: Jacob heads to a new yard in Central New York for some drywall. When he tries to pay using his debit card, the associate tells him there will be an additional $2 charge added for any debit/credit card purchases. | Violation | Violation |
| Listed Itemized Price Scheme: Francis goes into a supply yard and sees a sign that says: “The first price listed is for a credit or debit card. The second price is for cash.” | Compliant | Compliant |
| Flat Fee Notice: Steve goes to his corner store for some fries. A sign on the door says, “$5 fee for credit or debit card sales.” | Violation | Compliant |
| Cash Discount: Dave goes into his local building materials supplier. A sign at the register says, “$3 discount for all cash purchases.” | Compliant | Compliant |
| Post Purchase Fee: Nicolina visits a food truck for lunch. When she gets the check, she notices a “services fee” was added for using a credit or debit card. | Violation | Violation |
| Percentage Discount: A banner at the door reads “3% discount for all purchases using cash.” | Compliant | Complaint |