The statute, section by section
Post it on signs at the entrance and register, on the menu for restaurants, on the checkout page online, and out loud by phone [1]. New Jersey's surcharge law is P.L.2023, chapter 146 (Assembly bill A4284), approved Aug 18, 2023 and effective immediately [1]. It adds two sections to the Consumer Fraud Act: N.J.S.A. 56:8-156.1 (definitions) and 56:8-156.2 (the rule) [1].
| Term | What the law says |
|---|---|
| Surcharge | "any additional amount imposed by a seller at the time of a credit card transaction that increases a charge to a customer for the use of a credit card" |
| Credit card | "a card, plate, charge card, charge plate, or other single credit device that may be used from time to time to obtain credit" |
| Seller | "a person who sells, leases, or rents goods or services to a customer" |
| Goods | Beverages, chattels, foodstuffs, products or wares, "but shall not include motor fuel" |
| Restaurant | "an establishment in which the principal business is the sale of food or beverages for consumption on or off the premises" |
The core rule in 56:8-156.2(a) is one sentence: a seller "shall not impose on a customer who uses a credit card for a transaction occurring in New Jersey a surcharge that is greater than the actual cost to the seller to process the credit card payment" [1]. The same subsection lets the Director of the Division of Consumer Affairs inspect your "account books, papers, documents, and other records" to check compliance [1]. Under 56:8-156.2(c), a violation is an unlawful practice under the Consumer Fraud Act [1].
Where your surcharge notice has to go
Subsection (b) says you must disclose "the amount of the surcharge" to the customer "prior to the customer incurring any charge for goods or services" [1]. Where that notice goes depends on how you sell:
| How you sell | Where the notice goes |
|---|---|
| Store or office (not a restaurant) | A clear and conspicuous sign at the point of entry and the point of sale |
| Restaurant | A sign in the customer service area and on the menu |
| Website, mobile app or electronic kiosk | Clear and conspicuous electronic notice on the checkout page, before processing |
| Telephone order | Verbal notice before processing the transaction |
A sign that states the amount
"We add a 2.5% surcharge to credit card payments. This is not more than our cost to accept credit cards. There is no surcharge on debit cards or cash." Use your own true figure; 2.5% here is only an example.
The law asks for the amount of the surcharge, so a sign that only says "card fees may apply" leaves out what the statute requires [1].
Visa adds one more place: the surcharge has to be itemized separately on the transaction receipt [2]. A restaurant that meets the state rule with a menu line still needs the receipt line for Visa.
Working out your "actual cost" to process a card
The cap is your cost, not a number you pick. The statute does not define "actual cost" further, and the Division of Consumer Affairs can ask to see your records [1]. The practical evidence is your monthly merchant statement: total fees divided by total card volume gives your effective rate.
Two things make this tricky. First, cost differs by card: a rewards or business card usually costs more to accept than a basic card. Second, many processors bundle fees, so the statement rate can hide a markup. If you surcharge a flat percentage, set it at or below what your statements show, and keep those statements. The processing fee analyzer on this page reads a statement and shows your effective rate in a minute.
Visa sets its own ceiling on top of state law. Its current merchant guide says the surcharge "must not exceed your cost of acceptance for the credit card" and that a merchant whose cost is above 3% "cannot assess a surcharge above 3%" [2]. So in New Jersey the limit is whichever is lower: your actual cost, or 3% for Visa credit cards.
Can you surcharge debit cards in New Jersey?
New Jersey's law only speaks to credit cards; it defines a credit card as a device "used from time to time to obtain credit" [1]. It is silent on debit. The card networks are not. Visa's merchant Q&A says "U.S. merchants cannot surcharge debit card or prepaid card purchases," and that this holds even when a debit cardholder chooses "credit" on the terminal [3].
So the answer for a New Jersey business is no: do not surcharge debit or prepaid cards. Your terminal or processor needs to tell the card type apart, which most modern systems do. Ask your processor to confirm in writing before you turn surcharging on.
Checklist before you start surcharging in New Jersey
- Pull three recent statements and work out your effective credit card cost. Set the surcharge at or below it, and never above 3% for Visa [1][2].
- Tell your acquirer (your processor or bank) at least 30 days before you start, as Visa requires [2][4].
- Post the amount: signs at entry and register, or a sign and the menu for restaurants, or checkout-page text online, or a script for phone orders [1].
- Make sure the surcharge applies only to credit, never debit or prepaid [3].
- Make sure the receipt shows the surcharge as its own line [2].
- Keep statements and pricing records in case the Division of Consumer Affairs asks [1].
Many owners find that lowering the cost is worth more than passing it on. BatchOut, our processing team, can review a statement, and the analyzer above shows what you pay today. For other states, see surcharge laws by state.