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Merchants can now pass along card fees

Jan. 26, 2013 at 3:57 PM

WASHINGTON, Jan. 26 (UPI) -- Starting Sunday, U.S. businesses will be allowed to pass credit card fees to their customers, which could mean higher prices for some goods and services.

The allowable surcharge ranges from 1.5 to 4 percent and depends on how much a merchant or service-provider pays in fees to the card companies, ABC News reports.

Gerri Detweiler of Credit.com said big chains, able to negotiate better deals with the card companies, may decide not to impose surcharges. Small businesses are more likely to take advantage of the law.

Detweiler said some business-owners may have trouble figuring out how big a surcharge they can impose: "If you think your own credit card statement is confusing, take a look sometime at a merchant's credit card agreement with VISA or MasterCard."

Stores are required to post notices at checkout of the surcharge. That would allow customers to pay with cash instead or use debit cards, which are not included in the law.

Ten states, California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma and Texas, ban credit card surcharges.

Dettweiler suggests anyone who objects to the surcharge should let the owner or manager of a business know. She said enough complaints could lead to businesses deciding to forgo the extra revenue in hopes of keeping more business.

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