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New York Law Allows Credit Card Surcharges

A new state law legalizing credit card surcharges went into effect on Sunday, allowing business owners to charge a small fee to customers who choose to use a credit card at the register. This new law limits credit card surcharges to the amount charged by credit card companies to businesses. Businesses are required to include the surcharge in the displayed price, although they can also list a separate “cash price.” Additionally, businesses can choose to charge everyone the “credit card price,” allowing them to impose surcharges for credit card usage on customers who use other payment methods.

Under the previous law, credit card surcharges were completely prohibited, although business owners were allowed to offer discounts to customers who paid in cash. Governor Kathy Hochul introduced this legislation, which she signed in December, as a measure of “transparency” that would “clarify” the law regarding credit card fees.

“New Yorkers should never have to deal with hidden costs on their credit cards, and this law will ensure that people can trust that their purchases will not result in surprise surcharges,” Governor Hochul said in a statement. “Transparency is crucial for building trust between businesses and communities, and now customers will be empowered to budget accordingly.”

The legislation also reduces penalties for business owners who violate the rules. Violations under the previous law were considered misdemeanor crimes punishable by a $500 fine, one year of imprisonment, or both. The new law decriminalizes the offenses and instead imposes a civil penalty of $500 for each illegal charge.

It is important to note that this new law does not apply to debit cards.

Frequently Asked Questions (FAQ) About the New Credit Card Surcharge Law:

1. What does the new state law allow regarding credit card surcharges?
The new law allows business owners to charge a small fee to customers who use credit cards at the register.

2. How much can businesses charge for credit card surcharges?
Credit card surcharges are limited to the amount charged by credit card companies to businesses.

3. How should businesses include the surcharge in the displayed price?
Businesses are required to include the surcharge in the displayed price, although they can also list a separate “cash price.”

4. What other option do companies have for charging customers credit card surcharges?
Businesses can also choose to charge everyone the “credit card price,” allowing them to impose surcharges for credit cards on customers who use other payment methods.

5. What significant change does this new law bring compared to the previous legislation?
Previously, credit card surcharges were completely prohibited, but business owners were allowed to offer discounts to customers who paid in cash. With the new law, credit card surcharges are legalized.

6. Who introduced this legislation and what was its objective?
Governor Kathy Hochul introduced this legislation as a measure of “transparency” that would “clarify” the law regarding credit card fees.

7. What penalties do business owners face for violating the rules according to the new law?
The new law reduces penalties for business owners who violate the rules. Violations are now considered civil penalties of $500 for each illegal charge, instead of misdemeanor crimes.

8. Does this law apply to debit cards?
No, this new law does not apply to debit cards.

For more information on this new credit card surcharge law, you can visit the official website of the state government at ny.gov.

It is important to remember that this response is based on the information presented in the article, so it is always advisable to consult additional sources for a comprehensive understanding of any law or regulation.