New Visa Card Rules April 2023 Are You In Compliance?

Although I work in the payment industry, I too am a consumer of goods and services like everyone else. Since I work in the payments industry, I notice things that the average consumer may not notice.

I am beginning to notice is many businesses have not adapted to the new Visa Rules when a fee is added to a card transaction.

In April 2023, Visa made changes to their compliant Surcharging regulations. Non complaint programs using the non-cash adjustment, service fee or some other line-item fee on the credit card receipt will be considered non- compliant Surcharging and may cause a business to be subject to fines by Visa and Mastercard.

1. Surcharging:
   • Definition: Surcharging refers to the practice of adding an additional fee to the total transaction amount when a customer uses a credit card for payment.
   • Fees: Merchants implementing surcharging typically pass on the cost of credit card processing to the customers, charging a percentage of the transaction amount.
   • Regulations: As of April 15th, 2023 Visa prohibits surcharging on debit and prepaid card transactions and have reduced the cap to 3%.
   • Violations: Failure to adhere to regulations result in a 1st time fine up to $5,000, and additional penalties starting at $25,000 including termination of your merchant account.

 

1. Dual Pricing:
   • Definition: Dual pricing involves setting different prices for the same product or service based on the customer's chosen payment method (e.g., cash or credit card).
   • Fees: Merchants employing dual pricing may offer a discounted price for customers using cash and the higher price for those using credit cards.
   • Regulations: Merchants must display the two prices of a “Cash Price” and a “List Price”. This does not add a fee to the receipts.
2. Non-Compliance with Visa Regulations:
   • Penalties: Failing to adhere to Visa regulations can result in penalties and consequences for merchants. These may include fines, increased scrutiny, or even termination of the merchant account.
   • Consumer Perception: Non-compliance can also affect the perception of your business among consumers, potentially leading to a loss of trust and loyalty.

​If your business charges a cardholder a fee to use a credit card or debit card and your terminal receipts show a fee you may not be compliant with the new rules. Visa is being very aggressive in seeking out businesses that are not in compliant and assessing penalties. This is being accomplished with secret shopper programs and consumer complaints. If your current company has not updated your terminal or your Point of Sale to adhere to the new rules, you should give us a call so we can help you become and stay in are in compliance.

At Tampa Bay Merchant Services we are here to help you should you have questions this post or anything related to Point-of-Sale systems or credit card processing solutions. Give us a call at 727-748-4181