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Businesses aren’t allowed to charge you more for using a credit card, but cash discounts are allowed

Consumers in New York State may have encountered additional fees when paying with credit cards, but according to the New York State Division of Consumer Protection, such credit card surcharges are not permitted.


The state’s regulations mandate that businesses cannot advertise one price and then add a surcharge at the point of sale for credit card payments. While businesses are restricted from implementing surcharges, they are allowed to offer discounts to customers who opt to pay with cash.

The Department of State clarifies that while surcharges are banned, businesses can legally charge a higher price for credit card purchases, provided they clearly list this higher price. An example of a compliant business practice provided by the Department of State is a store displaying two prices: one for credit card or debit card payments, and a lower price for cash transactions. However, the use of “flat fee notice” or “percentage fee notice” for credit card purchases is a violation of New York law.

In response to this regulation, the Department of State has received a significant number of complaints about businesses breaching the surcharge rule, with 311 complaints this year, an increase from 2022 and 2021.

To address violations, consumers can file complaints with the Division of Consumer Protection for a refund of any fees paid, or with the Attorney General to enforce the law against a specific merchant. It is noteworthy that some protections under New York law for credit card purchases do not extend to debit cards. Although a surcharge for debit card use is allowed, it must be clearly disclosed. If a debit card is used as a credit card (bypassing PIN at checkout), it is treated as a credit card purchase under these regulations.