25 Mar What’s with surcharges on debit card purchases?

Q. Please discuss surcharges on debit cards. Many establishments are now adding a “surcharge/convenience fee” to customers using a credit and/or debit card. If I use a debit card, is the establishment permitted to add the surcharge? If permitted, is this because the debit card has a “Visa” or “Mastercard” logo on it? Many establishments raised their prices during Covid and now they’re adding a surcharge. It appears we’re being “nickeled and dimed.” Unfortunately, I prefer to use my debit card rather than carry large amounts of cash.
— Annoyed

A. As more and more companies charge the surcharges, this question comes up often.

Merchants cannot charge a fee for debit card transactions, but there’s a way they get around it — legally.

When a merchant runs your card, if you’re required to enter a PIN, it would be a debit card transaction and the fee would not be permitted.

But if your debit card has a Visa or Mastercard logo, it can be used as a credit card. So if a merchant runs your card and the purchase doesn’t require you to enter a PIN, it’s essentially being used as a credit card and not a debit card.

And then, the merchant can charge the fee.

If the merchant doesn’t give you the option to enter a PIN, the only way to avoid the fee is to pay cash.

If you think a store is wrongly charging the fee, you should report it to the Division of Consumer Affairs. 

Email your questions to Ask@NJMoneyHelp.com.

This story was originally published in March 2025.

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