New York Credit Card Surcharge Law: How to Post Prices and Stay Compliant
Learn what the New York credit card surcharge law requires, how to post the total card price, and how dual pricing and cash discounts fit.
Photo: Pixabay
On this page 8 sections
- What the New York Credit Card Surcharge Law Requires
- What Compliant Pricing Looks Like
- The Surcharge Rule Applies to Online Sales, Too
- Dual Pricing and Cash Discount Programs Are Expressly Allowed
- Why Card Type Matters for Surcharging
- Penalties for Noncompliance
- A Compliance Checklist for New York Merchants
- Next Steps: Set up a Compliant Pricing Program
Key takeaways
- Since February 11, 2024, New York sellers who surcharge credit cards must clearly post the total credit card price, including the surcharge.
- The surcharge can't be more than the amount the card company charges the business, and customers can't be charged more than the posted price.
- Two-tier (dual) pricing, showing a cash price and a card price, is expressly allowed.
- Violations can bring civil penalties of up to $500 each, so signage, menus, online prices and terminals all need to match.
If you add a fee when customers pay by credit card, the New York credit card surcharge law controls how you display your prices. An amendment to New York General Business Law § 518 took effect on February 11, 2024. It changed what "properly disclosed" means for credit card surcharges. A sign reading "3% fee for credit cards" next to cash prices no longer meets the rule on its own. This guide covers what the law requires, what compliant pricing looks like, how the law applies online, and how dual pricing and cash discount programs fit.
For a broader comparison of cost-offset programs, see our guide to cash discount vs. dual pricing vs. surcharging.
This article is general information, not legal advice. Confirm how the law applies to your business with a qualified attorney or advisor.
What the New York Credit Card Surcharge Law Requires
Under the amended statute, a seller that adds a surcharge for customers who pay by credit card instead of cash, check or similar means must clearly and conspicuously post the total price for paying by credit card, including the surcharge.
Three requirements stand out:
- The posted price must be the card total. You can't post only the cash price and disclose the card fee separately. Shoppers need to see the higher card price itself.
- The surcharge is capped at your cost. It can't exceed the amount the credit card company charges your business for the transaction.
- The final charge can't exceed the posted price. Customers can't pay more than the card price you displayed.
To check the cost cap, you need a clear picture of what you actually pay per card transaction. Our explainer on how credit card processing works breaks down the fees involved.
How Sales Tax Fits In
Local consumer protection offices also enforce the law. Erie County's guidance, for example, describes the posted figure as the highest total price excluding sales tax. The statute itself doesn't mention tax, so treat county guidance as interpretation and confirm the approach with your own advisor.
What Compliant Pricing Looks Like
The clearest way to understand the rule is to compare a noncompliant price display with a compliant one. The numbers below are illustrative only. Your actual surcharge can't exceed what you pay to accept the card.
| Price Display | Example (Illustrative) | Meets the Posting Rule? |
|---|---|---|
| Cash price only, with a card fee sign | Tag shows $50.00; sign says "3% fee for credit cards" | No |
| Card total only | Tag shows $51.50 | Yes |
| Both card and cash prices | Tag shows $51.50 card / $50.00 cash | Yes |
The common thread is that the card price, with the surcharge already included, has to be visible wherever the customer sees a price. That includes shelf tags, menus, price lists, service boards, quotes and online listings.
Restaurants should pay particular attention to printed and digital menus. Our restaurant payment processing guide covers other checkout considerations for food and beverage businesses.
The Surcharge Rule Applies to Online Sales, Too
Commentary on the amendment, including the Olshan law firm's analysis, notes that the law doesn't distinguish between brick-and-mortar stores and e-commerce. If you sell online to New York customers and add a credit card surcharge, the prices shown in your store and cart should reflect it.
When reviewing your online checkout, look at:
- Product and category pages, where shoppers first see prices
- The cart and order summary
- Any emailed quotes, invoices or payment links
If you're rebuilding or auditing your checkout, explore MannyPay's online payment solutions and our e-commerce payment processing guide.
Dual Pricing and Cash Discount Programs Are Expressly Allowed
The statute states that nothing in it prohibits merchants from offering a two-tier pricing system. In practice, that means you can:
- Post both a card price and a lower cash price, or
- Post only the card price and give a discount to cash payers
What you can't do is post only the cash price alongside a note about the card fee. That makes a dual pricing program a straightforward way to stay compliant while still offsetting processing costs. Merchants who prefer to post a single card price and reward cash payers can look at a cash discount program.
Surcharging vs. Dual Pricing vs. Cash Discount Under New York Rules
| Model | What You Post | Key New York Consideration |
|---|---|---|
| Surcharging | Total credit card price, including the surcharge | Surcharge can't exceed your card cost; final charge can't exceed the posted price |
| Dual pricing | Both a card price and a cash price | Expressly permitted as a two-tier pricing system |
| Cash discount | The card price, with a discount for cash payers | Fits the statute's allowance for posting only the card price |
Why Card Type Matters for Surcharging
Section 518 deals specifically with credit card surcharges. Card network rules also limit which cards can be surcharged, so check them with your processor before applying a surcharge.
In practice, your setup should apply a surcharge only to transactions where it's permitted. Confirm with your processor how your terminal and checkout handle different card types before you start surcharging.
Penalties for Noncompliance
Violations can bring a civil penalty of up to $500 per violation, and enforcement can come from state and local consumer protection authorities. For businesses with steady volume, small signage mistakes can add up quickly.
A Compliance Checklist for New York Merchants
- Choose your model: surcharging, dual pricing or cash discount.
- Update every price display. If you surcharge, make sure shelf tags, menus, price lists and online prices show the total card price.
- Check the cost cap. Confirm the surcharge doesn't exceed what you actually pay to accept the card.
- Confirm which cards can be surcharged. Review card network rules with your processor and make sure your terminal and checkout apply the surcharge only where permitted.
- Review your receipts. Show the price breakdown on every receipt.
- Re-check card network rules. The networks have their own surcharging requirements, so review them with your processor.
- Get professional input. Have a qualified advisor review your setup, especially on questions like sales tax treatment.
Next Steps: Set up a Compliant Pricing Program
The New York credit card surcharge law doesn't stop you from offsetting card fees, but it does change how you present prices. The core rule is simple: if you surcharge, the card total must be the price customers see.
MannyPay offers surcharging (where permitted), dual pricing and cash discount programs. If you're unsure which approach fits your New York business, request a free quote or contact the MannyPay team, and a specialist can walk through your options with you.
Sources
This article is for general educational purposes and is not legal, tax or financial advice. Card network rules and state laws change; confirm current requirements for your business.
