Can they charge you for using a debit card?

Debit Card Surcharges: What Merchants Can and Cannot Charge

In the United States, businesses are prohibited from charging customers additional fees for using debit cards. This nationwide protection ensures that consumers can make purchases with their debit cards without facing any extra costs.

Legal Basis

The Electronic Fund Transfer Act (EFTA) of 1978 established the legal framework for electronic fund transfers, including debit card transactions. Section 904 of the Act explicitly states that “no surcharge may be imposed on the cardholder for the use of an electronic fund transfer device.”

This law applies to all businesses in the US, regardless of their size or industry. Merchants are not permitted to add additional charges to goods or services solely based on the payment method used by the customer.

Consequences of Imposing Surcharges

Businesses that violate the EFTA by imposing debit card surcharges may face legal consequences, including:

• Fines
• Lawsuits by consumers
• Loss of business

Consumer Rights

Consumers have the right to use their debit cards without being charged additional fees. If a business attempts to impose a surcharge, customers are advised to:

• Politely decline the transaction and request to pay without the surcharge.
• Contact the business’s management or customer service department.
• File a complaint with the Consumer Financial Protection Bureau (CFPB).

Exceptions

There are a few limited exceptions to the prohibition on debit card surcharges:

• Cash discounts: Businesses may offer discounts for customers who pay with cash or check. However, the amount of the discount cannot exceed the reasonable cost of processing the debit card transaction.
• Special circumstances: In some cases, a business may be able to impose a surcharge if it can demonstrate that the actual cost of processing the debit card transaction exceeds the amount of the surcharge. However, this exception is narrowly construed and must be approved by the CFPB.

Conclusion

Consumers in the US have the right to use their debit cards without incurring additional charges. Businesses are legally prohibited from imposing surcharges for debit card transactions. If a customer encounters a business that attempts to impose a surcharge, they should politely decline the transaction and report the business to the appropriate authorities.