Can a business charge a fee for using a credit card in California?

What the Law Says

California prohibits businesses from adding a fee — known as a surcharge — when customers pay with a credit card. This rule is designed to protect consumers from unexpected extra costs at checkout.

Under California law, it is illegal for any seller to impose a surcharge on a customer who chooses to use a credit card instead of cash, check, or another payment method. A 'surcharge' means any additional fee or percentage added solely because the customer used a credit card.

However, the law explicitly permits offering a discount for paying by cash, check, or other non-credit means — as long as the discount is offered equally to all customers and is clearly disclosed.

Violations can result in civil penalties of up to $250 per violation, enforced by the California Attorney General or through private lawsuits under the Consumer Legal Remedies Act (CLRA).

Statutory Text

No seller in this state shall impose a surcharge on a cardholder who elects to use a credit card in lieu of payment by cash, check, or similar means.

— Cal. Civ. Code § 1748.6(a) — Prohibition on credit card surcharges

Statutory Text

This section does not prohibit a seller from offering a discount to customers who pay by cash, check, or other means not involving a credit card, provided that the discount is offered to all customers.

— Cal. Civ. Code § 1748.6(b) — Exception for cash discounts

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