Arkansas Credit Card Surcharge Laws

Quick Summary:

• Credit card surcharging is legal in Arkansas with disclosure requirements
• Maximum surcharge: 4% of transaction (3% for Visa cards)
• Must clearly post notice of surcharges before completing transactions
• Arkansas distinguishes between surcharge fees, convenience fees, and service fees
• Applies only to credit cards - debit card surcharging is illegal

Arkansas permits credit card surcharging with specific emphasis on proper disclosure and fee categorization. The Arkansas Attorney General provides detailed guidance distinguishing between surcharge fees, convenience fees, and service fees - making Arkansas unique among states for its clear fee definitions. This helps Arkansas's agricultural suppliers, construction contractors, and retail businesses properly implement cost-recovery programs while staying compliant.

Legal Disclaimer: This information is for reference only and does not constitute legal advice. Consult with an attorney before implementing surcharge programs, as rules can change.

Is Credit Card Surcharging Legal in Arkansas?

Yes, credit card surcharging is completely legal in Arkansas. The state permits surcharge fees with a primary requirement that businesses post clear notice of the surcharge before completing transactions.

Arkansas follows federal guidelines, which cap surcharges at 4% of the transaction amount (3% for Visa). The Arkansas Attorney General emphasizes that businesses must properly categorize their fees and provide adequate disclosure to customers.

What's Allowed

Arkansas businesses can implement surcharge programs with these guidelines:

• Surcharge up to 4% of transaction amount (3% for Visa cards)
• Apply to all credit cards including Visa, Mastercard, American Express, and Discover
• Clear advance disclosure required through posted notices before transaction completion
• All business types eligible including retail, restaurants, and B2B companies
• Third-party court payment surcharges are explicitly allowed under Arkansas Code § 16-13-706

What's Not Allowed

Federal law and Arkansas guidelines impose these restrictions:

• No debit card surcharging even when processed as credit transactions
• Cannot exceed processing costs - surcharges can't generate profit
• No hidden fees - all surcharges must be disclosed before payment completion
• Improper fee labeling - must correctly distinguish between surcharge, convenience, and service fees

Penalty For Non-Compliance

Arkansas businesses face enforcement through multiple channels for surcharge violations:

• Card network fines ranging from hundreds to thousands of dollars per violation
• Account termination by Visa, Mastercard, or other networks for repeated violations
• Consumer complaints through the Arkansas Attorney General's Consumer Protection Division
• Potential lawsuits under Arkansas's Deceptive Trade Practices Act

Customers can file complaints with the Arkansas Attorney General by calling (501) 682-2007, toll-free at (800) 482-8982, emailing oag@ArkansasAG.gov, or filing online consumer complaints.

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What's the difference between surcharge fees, convenience fees, and service fees in Arkansas?‍

Arkansas Attorney General provides specific definitions: surcharge fees are percentage-based charges for credit card transactions, convenience fees are flat amounts for alternative payment channels, and service fees are restricted to specific merchant categories like education and government. Mislabeling these fees can create compliance issues.

Can Arkansas agricultural suppliers surcharge equipment purchases?

‍Yes, agricultural suppliers and equipment dealers can surcharge credit card transactions on large equipment purchases. For example, a 3% surcharge on a $15,000 tractor attachment saves $450 in processing costs while remaining compliant with disclosure requirements.

Do online Arkansas businesses need special disclosure for surcharges?‍

Arkansas emphasizes disclosure "before completing transactions," which for online businesses means displaying surcharge information prominently during checkout before customers submit payment information, not just in terms of service.

Can rural Arkansas businesses surcharge if they only accept cards seasonally?‍

Yes, seasonal businesses can implement surcharges during their operating periods. However, they must still post clear notices and follow proper fee categorization guidelines even if only processing cards during harvest season or peak business periods.

Are court-ordered payment surcharges legal in Arkansas?‍

Yes, Arkansas Code § 16-13-706 specifically allows third-party entities to charge transaction fees when accepting court-ordered fine payments via credit card, though the state itself cannot charge these fees.