Rules & Regulations
Understanding Cash Discount and Dual Pricing versus Surcharging—and how the rules protect your practice.
Cash Discount
- Our system establishes the credit/card price as the regular price.
- Customers paying with cash receive a discount.
- This has been expressly permitted under federal law since 1981 under the Truth in Lending Act.
- The customer is receiving a discount—not paying a fee.
- Debit cards can be used to pay the card price.
Dual Pricing
- The merchant advertises both the cash price and the card price before the purchase.
- Neither price is considered a surcharge if both prices are properly disclosed.
- The customer simply chooses between two disclosed prices.
- Debit cards can be used to pay the card price.
As of today, no U.S. state expressly prohibits a properly implemented Cash Discount or Dual Pricing program.
Surcharging
- The merchant advertises “we add a 4% fee to all credit card transactions.”
- The fee appears on the transaction receipt.
- You CANNOT surcharge a debit card.
- The merchant will have a large bill at the end of the month to pay for debit card transactions.
As of today, credit card surcharging is still prohibited in some jurisdictions, although the number of prohibited states has decreased significantly over the past several years due to court decisions and legislative changes.
Insurance Copayments
For insurance copayments, you must charge the exact dollar amount specified in your contract with the insurance company. Our solution helps you collect insurance copayments efficiently while ensuring the correct amount is charged.
State Surcharging Rules
Where credit card surcharging is limited or prohibited.
Where Surcharging Is Prohibited
Currently, these states prohibit merchants from imposing a credit card surcharge:
- Connecticut
- Massachusetts
States With Restrictions (Not Bans)
Several states allow surcharging but impose additional requirements, such as limiting the surcharge to the merchant's actual cost of acceptance or requiring specific disclosures:
- Colorado – Surcharge capped by state law.
- New York – Strict pricing disclosure requirements.
- New Jersey – Surcharge cannot exceed the merchant's cost of acceptance.
- Nevada – Surcharge cannot exceed the merchant's cost of acceptance.
- South Dakota – Surcharge cannot exceed the merchant's cost of acceptance.
Federal & Card Brand Rules (Apply Nationwide)
Regardless of state law:
- Debit and prepaid card transactions may not be surcharged under federal law and the card network rules.
- Visa, Mastercard, Discover, and American Express all have operating rules governing surcharging, including disclosure requirements and limits on the surcharge amount.
What This Means for Your Practice
Since we offer Cash Discount and Dual Pricing programs—not surcharging—it's worth emphasizing:
- Cash Discount and Dual Pricing are permitted in all 50 states when properly implemented.
- Credit card surcharging is not permitted in Connecticut and Massachusetts (and Puerto Rico), and is subject to additional requirements in several other states.
This information is provided for general educational purposes only and does not constitute legal advice. Rules and regulations are subject to change. Please consult a qualified professional regarding your specific situation.