Credit Card Surcharging in Colorado

credit card surcharging in colorado
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Credit Card Surcharging in Colorado | Consumer Protection

A Coloradoan Perk

Did you ever imagine that safety from card surcharging would be one of the many benefits of living in Colorado? In 2013, it was added to the long list of Coloradoan perks. Credit card surcharging in Colorado is illegal for businesses. Colorado is 1 of 7 states that have protections against these laws. Connecticut, Kansas, Maine, Massachusetts, Oklahoma and Texas are safe for consumers as well, to some extent…

The Exceptions…

The Government & Education Payment Program Service Fee

The law against surcharging in the 10 protected states does not apply to service fees for a government authority or education institution. You may be wondering, “Why does the government get to surcharge while local businesses and non-profits cannot?” Simply put, when you are the one making laws, you can put in whatever exclusions you want to reserve for your benefit. There are some specific rules that government bodies and schools need to follow to abide by this program: See the Service Fee Rules (pg 10-11)

Convenience Fees

Different from surcharge fees and service fees, convenience fees are for merchants who offer an alternative payment channel, such as mail orders, telephone orders, or e-commerce sales. Essentially, these alternative payment channels are offered as a convenience to consumers so that they don’t have to drive to the physical site of the business to pay with cash.

credit card surcharging in Colorado VS Convenience FeesMost merchants today already offer these payment channels and it’s expected as part of the consumer experience, but the convenience fee program does not allow you to charge convenience fees for in-person transactions when the credit card is present at a payment terminal.  The biggest known perpetrator of convenience fees is TicketMaster. Sure, you can bring cash on the day of a concert and hope they have seats left, but it really is a convenience to arrive at the show with the ticket in hand. See the Convenience Fee Rules (pg. 10)

Discount Incentives

Some businesses will offer a discount on the purchase if it is made with cash, check, or some other non-electric fund transfer. It sounds unfair because it is so similar to credit card surcharging in Colorado, but the expression of the lowered pricing makes it legal because consumers won’t be surprised with add-on fees at checkout. Offering cash or check discount incentives does not break the law if the discount is offered and made aware to all prospective buyers clearly and prior to any purchase.

Debit Cards

Debit cards in any state are not allowed to be surcharged at all.

What can you do about it?

Protest Credit Card Surcharging in ColoradoRegardless of your residency, if you experience credit card surcharging in Colorado, you can be refunded the whole surcharge. Additionally, companies can face up to a $1,000 violation per offense. You can report a complaint through the Better Business Bureau and the CO Attorney General. If you want to keep from being surcharged immediately at the register, make sure you notify businesses that it is illegal. Don’t be bullied by them. Stand up for your rights.

The Law

Credit Card Surcharging in Colorado - the lawStay educated and read the law as it is written:

Colo. Rev. Stat. §5-2-212
“(1) Except as otherwise provided in §§24-19.5-103 (3) and 29-11.5-103 (3), C.R.S., no seller or lessor in any sales or lease transaction or any company issuing credit or charge cards may impose a surcharge on a holder who elects to use a credit or charge card in lieu of payment by cash, check, or similar means. A surcharge is any additional amount imposed at the time of the sales or lease transaction by the merchant, seller, or lessor that increases the charge to the buyer or lessee for the privilege of using a credit or charge card. For purposes of this section, charge card includes those cards pursuant to which unpaid balances are payable on demand.”

Credit Card Surcharging in Colorado: You deserve an explanation

Credit Card Surcharging in Colorado | Get Educated

As a member of the Better Business Bureau, we highly value transparency and truthful education with our clients. You deserve to understand what fees are legally allowed to be passed to cardholders and how to spot an unlawful company performing unethical credit card surcharging in Colorado.

Does your current processor educate you and treat you like we do? Please feel free to visit our blog page to learn more or post your story in the comments section below!

credit card surcharging in Colorado


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2 thoughts on “Credit Card Surcharging in Colorado”

  1. Karen Kuenning

    Can a commercial landlord charge a service fee for using a credit card to pay my business lease payment. The business is in Colorado

    1. Karen,
      Thank you for your insightful question. A Colorado commercial landlord (assuming they are a business entity and not a government entity) are not exempt from the CO statutes. The CO revenue statute defines a surcharge as “any additional amount imposed at the time of the sales or lease transaction by the merchant, seller, or lessor that increases the charge to the buyer or lessee for the privilege of using a credit or charge card.”

      I will say that it is relatively uncommon for landlords to accepts credit cards for lease payments because usually the lease payments tend to be quite large and landlords do not want to incur the 2-3% cost associated with processing a credit card when ACH or check is less costly. However, I could envision that with the pandemic over the last year, a smart landlord may have obtained a merchant account in order to assist payment collections from their tenants via credit when cash had run dry.

      Regardless of the reasoning behind it, they should not have imposed the credit card surcharge in Colorado. If you have already been surcharged in CO, what then should you do about it? Here are several ideas:
      1) contact your landlord & share this article with them or reference https://www.stopfraudcolorado.gov/resource-guide69c5.html?topic=21
      2) share your landlord’s contact information with us ([email protected]), and our expert will call them for a free consult to explain proper payment processing protocol
      3) contact your card issuing bank and dispute the extra surcharged portion of the payment
      4) consult with an attorney
      5) report them to the CO Attorney General as a consumer complaint: https://www.stopfraudcolorado.gov/about-us/file-fraud-report.html

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