August 24, 2023

The difference between "Surcharging" and "Dual Pricing"

Randy Butler

Understanding Visa-Compliant Surcharging vs. Dual Pricing: A Guide for Business Owners

If you're a business owner accepting card payments, it's essential to understand the intricacies of surcharging and pricing methods, specifically those compliant with Visa regulations. Today, we're diving deep into the world of surcharging and contrasting it with the dual pricing method commonly seen at gas stations.


Surcharging is the practice of adding a fee to a customer's transaction when they opt to pay with a credit card. However, not every surcharge is compliant with Visa's regulations. And not every processor provides hardware to implement a surcharge correctly. Here are the key guidelines:

1. Transparency: The surcharge must be clearly disclosed to customers as a separate line item on the receipt.

2. Limitations: The surcharge cannot exceed 3%.

3. Consistency: Any surcharge must also apply to all other credit card brands you accept, maintaining consistency.

4. Debit & Prepaid Cards: Visa rules prohibit surcharging on debit and prepaid cards.

5. State Laws: Some states in the U.S. have laws that prohibit or limit surcharging. It's crucial to check your local regulations before implementing any surcharge. Feel free to contact us at to get the most recent information regarding your state's regulations.

Dual Pricing: Cash vs. Card

Contrary to surcharging, dual pricing is a straightforward method where businesses (like many gas stations) offer two separate prices for an item or service: a cash price and a card price.

Characteristics of Dual Pricing:

1. Visibility: Both cash and card prices are visibly displayed. For gas stations, you'll often notice this on the main signage.

2. Simplicity: There’s no added fee at the end. The customer knows how much they will pay at the register based on their chosen payment method.

3. Flexibility: Dual pricing doesn’t discriminate between credit card brands, card types, or even debit cards. It’s a broad distinction between card and cash.

Surcharging vs. Dual Pricing: Which is Right for Your Business?

Benefits of Surcharging:

- Offset Fees: Helps businesses offset some of the transaction fees imposed by credit card companies.
- Flexibility: You can choose the surcharge amount, as long as it's compliant.

Drawbacks of Surcharging**:
- Complexity: Requires adherence to stricter regulations and possibly dealing with varying state laws.
- Customer Perception: Some customers may see it as an 'extra' fee.

Benefits of Dual Pricing:

- Offset ALL Fees
- The Greatest Possible Savings. Depending on your processor, the Card Price can be established to offset the acceptance of all card types.
- Transparency: Customers appreciate knowing the price differences upfront.
- Simplicity: Easier to implement without juggling multiple regulations.
- Fully Compliant.

In conclusion, the choice between surcharging and dual pricing boils down to your business model, customer preferences, and willingness to navigate regulations. Every business is unique! As always, feel free to contact us at Simple Clear Payments. We offer both compliant surcharging and Dual Pricing. We are happy to answer your questions to determine what's right for your business.

Stay informed and keep thriving!