North Carolina considers surcharge cap

North Carolina could become the next state to regulate credit card surcharges. On Sept. 23, 2025, the state's House of Representatives Finance Committee approved a bill that would cap surcharges at 2 percent, and impose a penalty of $500 on any business that charges more than 2 percent.

Businesses would be required to disclose the surcharge amount at the POS for in-person transactions, or on the website for online payments. If the payment is by phone, the information would be shared verbally, according to the bill.

North Carolina does not regulate credit card surcharges now, and it is unclear if this bill will garner approval this year by the full House and Senate. The two chambers are now in recess and will not return to consider legislation until Oct. 21. The bill as written has an implementation date of Jan. 1, 2026.

Consumer fees under fire

The practice of merchant surcharging can be a contentious issue, with two states, Massachusetts and Connecticut, as well as Puerto Rico banning credit card surcharges. At least a dozen other states impose certain requirements and/or restrictions on the practice, typically caps on surcharge percentages.

Here's a rundown of those states and the contingencies for each, provided by the Electronic Transactions Association:

• Illinois caps surcharges at 1 percent or the total processing fee, whichever is lower.

• In Colorado, the maximum surcharge a merchant can assess is 2 percent of the transaction amount.

• Georgia requires businesses that impose surcharges to provide customers with alternative payment options.

• In Kansas, a merchant that implements a surcharging program must incorporate those fees into the listed price of products.

• Surcharging per se, isn't allowed in Texas, but businesses can charge service fees and convenience fees, and they can offer cash discounts.

• In Nevada, New York, South Dakota and New Jersey, the surcharging rate cannot be more than what a business pays in processing fees.

• Florida allows surcharging, with certain conditions. For example, the surcharge cannot exceed the cost of credit card processing and must be listed as a separate line item on receipts.

• Michigan allows surcharging, but has strict rules regarding how customers are informed. For example, brick-and-mortar stores must install signage that explains surcharge fees to customers at every point of sale and entrance.

• In Montana, the surcharge rate is capped at 3 percent.

As lawmakers weigh North Carolina's proposal, the debate over how much transparency and flexibility businesses should have, as well as how much protection consumers need, shows no sign of abating.

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