NEW YORK – The New York State Division of Consumer Protection reminds New Yorkers that credit card surcharges are prohibited in the state. Businesses cannot advertise a price and add a surcharge at the point of sale when a consumer chooses to pay with a credit card.
Instead, businesses must inform consumers of the highest credit card price for a product or service by posting the highest price. Businesses can also offer a discount to consumers who pay in cash, they announced Tuesday.
New Yorkers using debit cards do not have the same protections as those using credit cards, the agency says. A higher fee or surcharge is allowed for the use of a debit card, but must be accompanied by a clear disclosure on the advertised street signage or a prominent location in the retail location.
“Many consumers and businesses are confused when it comes to market surcharges,” said Secretary of State Rossana Rosado, who oversees the New York State Division of Consumer Protection. “New York companies must advertise accurate prices. A business may offer a discount if consumers pay in cash, but they cannot charge more at the register simply because a consumer uses their credit card. “
Here are some examples of common transactions for New York consumers:
- Percentage rate: A person goes to a place to eat. That person sees a sign on the menu that says, “If you use a credit or debit card, you will have a 5% fee.”
Credit card requirement: Violates the rule
Requirement for debit card: Meets the standard - Additional charge: Someone goes to a food truck parked on the corner and orders a lunch. When you go to use your debit card, the operator tells you that an additional $ 2 will be added because you are using your debit card.
Credit card requirement: Violates the rule
Requirement for debit card: Violates the rule - Detailed pricing scheme listed: Someone enters a shoe store where they say “The first price shown on the object is the one indicated if you use a credit or debit card for your purchase. The second price is if you pay in cash. ”
Credit card requirement: Meets the standard
Requirement for debit card: Meets the standard - Fixed rate notice: Someone goes to the corner store to buy some groceries. A sign on the cash register reads: “$ 5 fee for credit or debit card sales.”
Credit card requirement: Violates the rule
Requirement for debit card: Meets the standard - Cash discount: Someone goes to a flower shop. A sign on the cash register reads: “$ 3 off all cash purchases.”
Credit card requirement: Meets the standard
Requirement for debit card: Meets the standard - Post-purchase fee: Someone is going to the restaurant. When you receive the check, you notice a “service charge” that was added when you said you were paying with your credit or debit card.
Credit card requirement: Violates the rule
Requirement for debit card: Violates the rule - Pay at the pump: Someone stops at a gas station. The price per gallon is listed, and it’s the same as the price on the sign you saw when you drove. There is also a discounted price per gallon if you choose to pay cash inside the store.
Credit card requirement: Meets the standard
Requirement for debit card: Meets the standard - Percentage rate notice: At the end of the medical appointment the person sees a sign that says: “3% fee for all credit and debit card transactions.”
Credit card requirement: Violates the rule
Requirement for debit card: Meets the standard - Discounted product: The person stops at the gas station. A sign reads, “free cup of coffee with all cash sales.”
Credit card requirement: Meets the standard
Requirement for debit card: Meets the standard - Discount rate: a banner from the supermarket says “3% discount for all cash purchases.”
Credit card requirement: Meets the standard
Requirement for debit card: Meets the standard
In New York the State Attorney General has the authority to enforce these laws and the Consumer Protection Division is charged with helping aggrieved consumers in the marketplace. When issues arise with New York State merchants incorrectly charging additional fees, consumers can file complaints like this:
1. File a complaint with DCP to request a refund of any fees paid to a merchant in New York State.
2. File a complaint with the Attorney General to enforce the law against a specific merchant that you believe has violated the law.
Consumers can better support their complaints by submitting evidence of non-compliance, which may include images of advertised price and rates, receipts with assessed rates, details of merchant location, and more.
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