CardX in Digital Transactions: “How a New Ruling Sets the Stage for Surcharging in All 50 States”
“Last year, the U.S. Supreme Court held that ‘no-surcharge’ laws regulate constitutionally protected speech, turning the tide in favor of merchants challenging bans in Florida, California, and Texas.
Now, businesses in these states have the option to pass on the fee when their customers choose credit cards for convenience or rewards, so long as they comply with the card network rules introduced in 2013.
As the market for surcharging has expanded, so too has the emphasis on compliance. The card brands and processors have increasingly sought to shut down non-compliant programs, especially when surcharges masquerade as ‘cash discounts.’
In September, First Data Corp.’s Clover unit removed all ‘cash-discount’ programs from its app marketplace, stating in an email to users, ‘A “true cash discount” does not add any fees or surcharges at the register.’”