No, it is illegal in Maine for businesses to add a surcharge (extra fee) for using a credit or debit card, as state law prohibits these extra charges, requiring upfront pricing and banning hidden fees, though offering a cash discount is a legal alternative to avoid these fees. Maine is one of several states with laws preventing merchants from adding extra costs to card payments, ensuring the advertised price reflects the final cost for all payment types or providing discounts for cash.
Maine's “No surcharge for credit or debit card payments” law prohibits sellers from adding extra charges (surcharges) to credit card or debit card transactions.
Yes, charging a 3% credit card fee (surcharge) is generally legal in most U.S. states and follows card network rules (like Visa's 3% cap), but it depends heavily on your location and requires strict adherence to rules, such as not surcharging debit cards, capping it at your actual processing cost (not to exceed 3% for Visa/4% for Mastercard), and providing clear customer notification. Some states (like Connecticut, Massachusetts, Texas) may have their own bans or restrictions, so it's crucial to check your specific state laws.
Understanding Credit Card Surcharging Laws in California
Rather than banning the practice of surcharging entirely, California requires that any fee tied to the use of a credit card be fully included in the advertised price or invoices.
To avoid a credit card surcharge, you can pay with alternative methods such as cash, debit cards, or mobile payment apps. Some businesses also offer discounts for non-credit card payments, providing an incentive to choose other payment options that help avoid credit card surcharge.
The 2/3/4 rule is a guideline, primarily used by Bank of America, that limits how many new credit cards you can get: no more than 2 in 30 days, 3 in 12 months, and 4 in 24 months, helping to prevent over-application and manage hard inquiries on your credit report. While not universal, it's a useful benchmark for responsible card application, though other banks have different rules (like Chase's 5/24 rule).
The easiest way to avoid card surcharges is to pay by cash. While businesses can charge a surcharge for paying by debit or credit cards, they can't charge a surcharge for paying by cash.
The most common fees for accepting credit card payments are transaction fees, which are usually a percentage of the payment plus a fixed amount per transaction. You can pass on credit card processing fees to clients by adding a small percentage or flat fee to the invoice to cover those costs.
Nationwide, the surcharge rate for credit card transactions cannot exceed 4% of the total transaction (3% for Visa cards). Businesses must inform customers about the surcharge both online and in-store before payment. The surcharge must only cover processing costs and cannot be a profit-making tool.
Yes. U.S. merchants may assess a surcharge on credit card purchases that does not exceed the merchant discount rate for the applicable credit card surcharged*.
The "777 rule" in debt collection, also known as the 7-in-7 rule, is a CFPB regulation (Regulation F) limiting calls: collectors can't call more than 7 times in 7 days for a specific debt, nor call within 7 days of a conversation about that debt. It aims to prevent harassment, applying to calls, texts, and emails, though exceptions exist, and the presumption of compliance can be rebutted by aggressive call patterns like rapid succession or highly concentrated calls.
What Is the 15/3 Rule?
Businesses are charging credit card fees (surcharges) primarily to offset the rising costs of processing card payments, which include fees from card networks (Visa, Mastercard) and banks, allowing them to protect thin profit margins, offer lower prices for cash/debit users, and stay competitive without raising prices for everyone. These fees have increased as more consumers use credit cards, making these processing costs a significant business expense, sometimes even third behind payroll and rent, pushing merchants to pass these costs directly to card-using customers.
Eleven states—California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma and Texas—and Puerto Rico have laws that prohibit merchants from charging consumers with surcharges on credit card transactions.
Using 90% of your credit limit creates a very high credit utilization ratio, which significantly hurts your credit score by signaling high risk to lenders, though you won't "overdraw" it like a bank account; it can also lead to higher interest rates (Penalty APRs), so it's best to keep utilization below 30%, ideally even lower, by paying down balances.
Businesses can only apply surcharges to credit card transactions. It is a violation of card brand rules and some state laws to apply surcharges to debit or prepaid card transactions, even when the debit or prepaid card is treated like a credit card during checkout. Surcharges are typically a percentage-based fee.
Move big invoices to ACH
Shifting high-dollar tickets and invoices from credit card to automated clearing house (ACH) processing can drop your costs significantly. ACH payments for small businesses are direct bank debit transactions or electronic bank-to-bank transfers.
How to Notify Customers about Convenience Fees