A New Credit Card Surcharge?

Businesses can now charge customers who use a Visa or MasterCard an extra fee. But will they?

As of January 27, brick-and-mortar retailers and online merchants in 40 states can add up to a 4% surcharge to purchases made with a Visa or MasterCard. The surcharge, called a checkout or swipe fee, is allowed because of a recent court settlement between retailers, the card companies and nine major banks, according to Consumer Action, a consumer advocacy group. The settlement allows retailers to pass on the cost of processing credit card transactions to customers -- a practice that previously was banned. However, most merchants probably won't be adding a surcharge to credit card purchases, says Craig Shearman, a spokesman for the National Retail Federation.

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Cameron Huddleston
Former Online Editor, Kiplinger.com

Award-winning journalist, speaker, family finance expert, and author of Mom and Dad, We Need to Talk.

Cameron Huddleston wrote the daily "Kip Tips" column for Kiplinger.com. She joined Kiplinger in 2001 after graduating from American University with an MA in economic journalism.