Businesses may ask you to pay credit card surcharges, also known as checkout fees, when you pay with a credit card. These fees make credit card purchases more costly, even if it’s just a small percentage. Sometimes, it makes sense to pay credit card surcharges, but it boils down to whether the benefits of using a credit card outweigh the cost. Here’s how to decide when paying credit card surcharges is worth it.
What Are Credit Card Surcharge Fees?
Credit card surcharges are fees that a merchant adds to your total when you use a credit card for payment instead of other payment forms, such as a debit card, cash or check. Credit card surcharges are intended to help merchants cover the cost of processing your credit card transaction.
You’ll recognize a credit card surcharge when a merchant informs you there’s an extra charge to pay when using a credit card. For example, you may see a sign that says there’s a 3% charge for credit card purchases. That translates to paying $25.75 instead of $25 when using a credit card.
Visa and Mastercard limit the allowed surcharge amount to the merchant discount rate, which is usually around 1% to 3%. Businesses must clearly disclose surcharge policies to customers. It’s illegal to charge credit card processing fees to consumers in some states. However, merchants can offer a cash discount in all states. With a cash discount, a business can increase prices to cover processing fees and then offer a discount to customers who pay cash.
When to Pay a Credit Card Surcharge
Credit card surcharges can increase your cost, but paying a credit card surcharge generally makes sense when the benefits of using a credit card outweigh the costs.
“Before you pay a credit card surcharge, consider how much it’s worth for you to be able to use a credit card for your purchase,” says Barry Choi, personal finance expert at Money We Have. “Surcharges on small purchases might not be a big deal, while the surcharge on larger purchases can add up to a more substantial amount of money.”
Consider paying the fee in these scenarios:
The Rewards Earn More Than the Surcharge
You can come out ahead if the value of the rewards you’ll earn for the purchase are worth more than the surcharge.
For example, if the surcharge is 2% and you can earn 3% or more in cash back or rewards, you’ll still get 1% cash back — especially if you’re working toward a sign-up bonus. It may be worthwhile if a purchase helps you earn a welcome offer worth hundreds of dollars. Just make sure the fee doesn’t exceed the bonus value.
You Need Credit Card Protections
Paying with a credit card offers stronger consumer protections than paying with a debit card or in cash. It’s also easier to dispute charges, and some credit cards offer purchase protection, extended warranties and fraud protection that can save you money if something goes wrong. It can be worth it if you’re making a large purchase, want extended warranty coverage or are unfamiliar with the merchant.
You’re Using a 0% APR Offer
Paying a small surcharge may be worth it to spread out payments if your card has a 0% introductory annual percentage rate on purchases. A 3% surcharge fee is far less than you’d typically pay in regular credit card interest if you carry a balance without a 0% offer.
Using a 0% offer can make sense if you’re managing major expenses such as home repairs, medical bills or appliances, as long as you can pay off the balance before interest applies.
The Surcharge Is Small
Paying an extra 10 or 20 cents for the convenience of using a card to buy coffee might seem worth it, but you may hesitate if you need to pay hundreds to charge a large bill to use your card.
Practice Responsible Card Use
As you consider paying a surcharge, remember that you’ll still need to practice responsible card use. You shouldn’t pay a surcharge if it exceeds your rewards rate, the purchase offers no added protection benefit or you’ll carry a balance and pay interest.
“The interest you will be charged for not paying your card off in full will most likely eat up a lot more than any benefits you may have earned for using your credit card,” says Chip Chinery, personal finance blogger at Chip’s Money Tips.
[Read: Cash Back Credit Cards]
Avoiding Credit Card Surcharges
As the cost of doing business increases, some merchants consider credit card surcharges a way to lower costs without raising prices for customers. But that doesn’t mean you have to pay that cost as a consumer.
Always look for credit card surcharges if you plan to pay by credit card. The fee should be prominently displayed in-store or online as you check out, but also examine receipts for additional fees.
If a business requires a credit card surcharge you don’t want to pay, you don’t have to shop there. Consider alternatives, such as a restaurant or coffee shop around the corner that doesn’t impose a surcharge.
For larger purchases, it can be beneficial to negotiate with the merchant. You might offer to pay your bill in full if you can do it by credit card without a surcharge. That could be appealing to merchants that take deposits or offer financing. Or you might leverage customer loyalty when negotiating surcharges.
And, of course, it helps to carry cash or keep money in your checking account for purchases when you don’t think it’s worth paying a surcharge to use a credit card.
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When Should You Pay a Surcharge for Using a Credit Card? originally appeared on usnews.com
Update 02/20/26: This story was previously published at an earlier date and has been updated with new information.
