While only 10 states across the U.S. have implemented a ban on credit card surcharges, legislatures in 13 other states are currently considering legislation to prohibit retailers from charging “checkout fees.”
California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma and Texas already prohibit retailers from surcharging consumers who pay with a credit card, NBC News reports.
Hawaii, Illinois, Kentucky, Maryland, Missouri, New Jersey, Pennsylvania, Rhode Island, South Carolina, Utah, Vermont, Washington and Tennessee recently introduced legislation to ban the practice after retailers were able to begin charging consumers extra to pay with a credit card last month. West Virginia is also expected to introduce similar legislation.
As part of a settlement with retailers over interchange fees, Visa and MasterCard agreed to let merchants charge a “checkout fee” for credit card transactions, a practice that was prohibited until last month, when the rule change took effect, according to NBC News.
Assemblyman Vincent Prieto (D-N.J.) said that he introduced a measure to ban surcharging because it would increase costs for consumers.
“The amount of the surcharge may seem minuscule on paper, but in the family budget, 1.5 to three percent could add up to a shorter grocery list or less to spend on gas,” Prieto said, NBC News reports.
Big-box retailers are not expected to take advantage of the surcharge, but the possibility that they might has prompted many legislators to introduce measures to block the practice.
“It’s a waste of the legislative process,” Mallory Duncan, the senior vice president of the National Retail Federation, said, according to NBC News. “They could take steps to bring greater competition into the marketplace by prohibiting the price fixing of the hidden swipe fees merchants pay to process credit card transactions.”
The new Visa and MasterCard rules require merchants to post a notice about the surcharge at the point of entrance to the store, point of sale and as a line item on the receipt, though online retailers will only be required to post notice on the checkout page.