We have a question regarding merchants charging a fee when a customer
uses a credit card to make a purchase.  Can merchants either charge a
fee or insist on a minimum purchase in order to accept the card at
all? Is this allowed under the credit card company rules?

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Request for Question Clarification by efn-ga on 05 Dec 2004 16:37 PST

The answer may vary depending on where the transaction takes place. 
For what country would you like an answer, and if in the United
States, what state?

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Clarification of Question by james1352-ga on 05 Dec 2004 17:55 PST

For the USA, and we are in California.

Hi james1352,

In California, a surcharge for using a credit card is illegal,
according to section 1748.1 of the California Civil Code.  However, a
merchant can offer a discount for cash payment.

http://www.leginfo.ca.gov/cgi-bin/displaycode?section=civ&group=01001-02000&file=1747-1748.7

Surcharges are also not allowed by Visa or MasterCard.

Requiring a minimum purchase for using a credit card is legal in
California, but may or may not be allowed by the credit card company. 
As with surcharges, Visa and MasterCard do not allow minimum purchase
requirements.  American Express and Discover do allow them, but don't
allow merchants to discriminate.  That is, if a merchant takes any
other card (such as Visa or MasterCard) without requiring a minimum
purchase, American Express and Discover do not allow that merchant to
set minimum purchase requirements with their cards.

I gathered this information from a number of web pages about credit
cards.  They didn't all have the same pieces of the story, but they
were all consistent.  I'll list the links.

Credit card information page on the Credit Infocenter site
http://www.creditinfocenter.com/cards/crcd_buy.shtml

Credit card information page on The Credit Report Site
http://www.thecreditreportsite.com/credit_cards.asp

Kokua Line column by June Watanabe from the Honolulu Star-Bulletin, 2001
http://starbulletin.com/2001/09/26/news/kokualine.html

Page on credit card surcharges and cash discounts from the Credit-Factor website
http://www.credit-factor.com/TrueFactDetails.aspx?fid=116


I hope this information is helpful.  If you need any further
information, please ask for a clarification.

--efn