Credit card surcharging, set up to the rules
Since October 2022, businesses in most of Canada can pass part of the cost of accepting credit cards to the customer as a surcharge. The rules are specific, and getting them wrong can put the merchant account at risk. We set it up properly, or tell you when it is not the right fit.
- Applies to
- Visa and Mastercard credit cards. Their debit and prepaid cards cannot be surcharged, and Interac has its own rules
- Where
- Across Canada except Quebec, where consumer protection law does not allow it on consumer purchases. US rules vary by state and card brand
- Before you start
- Written notice at least 30 days ahead: to your processor, and to Mastercard
- At the till
- Notice at the entrance and again at checkout, the chance to cancel, and the surcharge on the receipt
- The cap
- Set by each card brand, never more than what accepting the card costs you, and limited further if you accept American Express or PayPal
How we set it up
We model surcharging against a fitted agreement, your card mix and the other cards you accept, so you see both paths before you decide.
We prepare the written notices with you and set your terminals or POS to add the surcharge only to eligible credit cards.
Notice at the entrance or on your site, the amount at checkout, and the surcharge on every receipt. We walk you through what customers must see.
What a surcharge is
A surcharge is a fee added to a credit card payment to cover part of what accepting the card costs the business. It is not the same as a convenience fee, and the two cannot be combined. A cash discount, which lowers the posted price for customers who pay another way, is a separate option with its own rules.
What the rules require
Visa and Mastercard allow surcharging on credit cards under conditions: written notice at least 30 days before you start, notice to customers at the entrance and again at checkout so they can choose another way to pay, the surcharge shown on the receipt, and a cap set by each brand that is never more than what accepting the card costs you. Visa and Mastercard debit and prepaid cards cannot be surcharged, and Interac debit has its own separate rules. Quebec's consumer protection law does not allow surcharges on consumer purchases.
If you also accept American Express or PayPal, their rules limit what you can surcharge on Visa and Mastercard, and that is often what decides whether surcharging works for you. The limits differ by card brand and change from time to time, so we confirm the current rules for your card brands and locations when we set it up.
Where Kubera helps
Most of the work is in the setup. Your terminals or POS need to tell credit from debit and add the surcharge only where it is allowed, receipts need the separate line, and the notices need to go in before you start. We do that work with you on the systems we deploy, and check whether the system you run today can do it.
Is it right for your business?
Surcharging recovers cost at the till, and every customer sees it. For some businesses that trade is worth it; for others, a fitted agreement does the same job without the conversation at the counter. We model both against your statement so you can decide with the numbers in front of you.
If you have locations in the US, the rules differ by card brand and by state, and some states restrict surcharging. We set it up to the rules where each location operates.
For how the three layers of a card fee work, and what else to look for on a statement, see credit card processing.
Common questions
Is credit card surcharging legal in Canada?
Yes, outside Quebec. Since October 2022, Canadian businesses can add a surcharge to Visa and Mastercard credit card payments, within card brand rules on notice, disclosure and the maximum amount. Quebec's consumer protection law does not allow surcharges on consumer purchases.
Can I surcharge debit or Interac payments?
Not under the credit card rules. Visa and Mastercard debit and prepaid cards cannot be surcharged. Interac debit has its own rules: any Interac surcharge is applied by the processor rather than added by the business, and it must be disclosed so the customer can cancel. We tell you what applies to your setup.
How much can I surcharge?
Each card brand sets a maximum, and the surcharge also cannot be more than what accepting the card costs you. If you accept American Express or PayPal, their rules can limit it further. The limits can change, so we confirm the current caps for your card brands when we set it up.
Do I have to tell the card brands before I start?
Yes, in writing, at least 30 days before you start. Visa requires notice to your processor, and Mastercard requires notice to Mastercard and your processor. We prepare both with you as part of the setup.
Can you set up surcharging on my current terminals?
Often, if your terminal or POS can tell credit from debit and add the fee only to eligible cards. We check what you run today, and we set it up on the systems we deploy.
Does surcharging work the same in the US?
No. US rules differ by card brand and by state, and some states restrict or ban surcharges. For businesses with US locations, we set it up to the rules where each location operates.
A recommended payments partner of the BC Chamber of Commerce
See whether surcharging fits your business
Send us a recent statement. We read it line by line and come back within 1 to 2 business days with what you are paying today, and what surcharging or a fitted agreement would change. No obligation, just numbers.
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