By Jim Donovan: Do you like to charge things on your credit card? Well depending on where you shop, now it may cost you!

Beginning Sunday, January 27th, merchants who accept MasterCard and Visa are now able to add a surcharge to your bill. That surcharge would be the equivilent of what that merchant pays to the credit card company to process transactions from a consumer. The so-called “checkout fees” can typically range from 1.5% to 3%, although some can go as high as 4% of the purchase price.

The new surcharge is one result of a class-action settlement reached last year between merchants and banks/credit card companies. The fees apply only to credit cards, not to debit card payments, and while merchants in Pennsylvania, New Jersey and Delaware can add the surcharge, the fees are illegal in ten other states including New York.

According to the terms of the settlement if a merchant adds a surcharge to Visa or MasterCard purchases, they would have to do the same with American Express cards. Currently American Express prohibits such surcharges. So in theory, if a merchant accepts AMEX, that would cancel out their ability to add the surcharge to any other cards.

In order to charge a “check out” fee retailers must provide clear disclosure. That means signage will have to be placed at a store entrance, at the point of sale, and on the customer receipt. In addition the receipt must list the amount of the “check out” fee too.

It’s believed that larger retailers, which have the ability to negotiate lower transaction fees with the credit card companies, won’t likely add a “check out” fee to a customers bill. Smaller merchants however who’ve been eating the credit card processing costs for years, now at least have the option of passing it on to consumers.

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