I came in to support a local small business and purchase coffee and food. At checkout, I saw a flat 4% fee on both credit and debit card purchases.
Just as I've done with other businesses, I referenced Visa's own guidance and asked for the fee to be removed, since I know as a Visa processor this can be corrected directly on Clover systems.
She was dismissive and short with me the whole time. I asked to speak with a manager, she said none was on duty. I asked for a card for the owner instead, she said I couldn't speak with the owner either. I offered to leave my phone number so the owner could reach out, to provide the mentioned violations like this can carry real consequences, including card network fines. She refused to write my number down and gave me a clear attitude while doing it.
As a business owner myself, I'd want to know immediately if a compliance issue like this was happening at my business and I'd want to know how a customer-facing employee was treating people over it. A public review was the only way left to reach the owner.
Once the debit card surcharge is removed, I will update this review.
What customers should know:
First, debit card surcharging is illegal in Indiana and every other state -- federal law under the Durbin Amendment (Dodd-Frank) prohibits surcharges on debit card transactions regardless of how the transaction is processed, even when a debit card is run as signature/credit. This isn't a gray area; it's a federal rule that overrides any state law.
Second, even setting the debit issue aside, a flat 4% surcharge on credit cards is also questionable, federal rules cap surcharges at 4%, but Visa's own network rules limit surcharges to 3%, and a merchant accepting multiple card brands has to apply the surcharge uniformly, which effectively caps it at 3% for any business that takes Visa.
If you've been charged a surcharge on a debit card purchase, here's how to report it:
* Visa: Submit a complaint through Visa's Merchant Surcharge Complaint Form.
* Mastercard: Report the merchant through Mastercard's merchant violation reporting form.
* Discover: Call their merchant services line to report a compliance violation.
* State Attorney General: File a consumer complaint with your state's Attorney General's office.
* CFPB: Submit a report to the Consumer Financial Protection Bureau.
The rules
1 The merchant must be registered with the card brands2 The merchant must inform their customers of the credit card fee with appropriate signage at the store entrance (if applicable) and at the point of sale.3 The amount of the credit card fee must not exceed 3%, and the merchant must not profit from the credit card fee.4 The credit card fee and the price of the product or service must be processed together as one transaction.5 The receipt must show the amount of the credit card fee as a separate line item.6 The merchant must not apply a fee to debit cards. read more
