SC restaurants charge extra for using a credit card. Do you have to pay it?
Some South Carolina diners may be alarmed when they receive their restaurant bill, only to see they’ve been charged extra for paying with a credit card.
While some states have outright bans on credit card fees at businesses, South Carolina does not.
In the Palmetto State, these credit card surcharges are allowed, but restaurants and other vendors must follow certain guidelines when it comes to charging extra.
In the Myrtle Beach area, restaurants will often offer discounts to customers for using cash. But those buying items or food in Myrtle Beach city limits, for example, might see prices climb higher when credit card fees combine with tourist fees and city, county and state taxes.
But do you have to pay them?
Credit card surcharges are often implemented as a way to help businesses offset the cost of processing the cards, which can include fees charged by credit card companies. As long as South Carolina restaurants and merchants comply with federal regulations and the rules set forth by credit card companies, they are in the clear.
First, merchants are required to disclose the surcharge to customers before the transaction. Customers have to be notified upon entry of the establishment, such as with a posted sign, and at the time of sale.
The surcharge is also not allowed to exceed the amount it costs the merchant to process the card, or a set cap, which is usually set at 4% — whichever is lower.
Additionally, debit cards cannot be surcharged, even if the customer selects “credit” on a transaction but then pays with a debit card.
Credit card companies also do not prohibit credit card surcharges. For example, Visa advises merchants to abide by state laws and requires them to properly notify customers, but does not ban surcharges.
Merchants can also choose to apply surcharges on Visa cards at the “brand level,” meaning all Visa cards only, or at the “product level,” meaning a certain kind of Visa credit card gets surcharged, according to the company’s website.
Additionally, restaurants and businesses can offer a “cash discount,” incentivizing customers to pay with methods other than credit cards. Businesses that do so must display either the card price or the cash and card prices side by side, according to Visa.
If a credit surcharge is applied to a debit transaction, or otherwise violates state laws or card company guidelines, the charge can be disputed. Consumers can check for the surcharge by scanning through the line items on their receipts.
