We see it everywhere: signs beside cash registers, on the bottom of receipts, and even on some websites, “There is a 2.5% fee for using a credit or debit card.” We usually don’t think anything of it and pay the fee. Recently, while paying for documents in El Paso County, Texas, I was told there would be an additional fee for using my debit card. It’s just part of doing business, right?

If you are using a debit card, those charging you fees are wrong.

The Durbin Amendment of the Dodd-Frank Wall Street Reform and Consumer Protection Act prohibits a surcharge on debit card transactions in the United States. Businesses can’t add a surcharge or a convenience fee to debit cards even if you select “credit” on the point of sale terminal.

(You can download the Durbin Amendment of the Dodd-Frank Wall Street Reform and Consumer Protection Act here: https://www.federalregister.gov/documents/2023/11/14/2023-24034/debit-card-interchange-fees-and-routing)

“Using a debit card is the same as using cash,” says an independent financial specialist, Jennifer Younger. “When you pay with cash, you are not charged a fee. It’s the same when you utilize your debit card for payment.”

“Surcharge fees are strictly limited to credit card transactions only,” says Jennifer Younger. “Even if you wish to run a signature debit transaction, where a debit card is processed as a credit transaction, you are still not allowed to add a surcharge.”

Surcharges are also not applicable to prepaid cards.

Visa, MasterCard, or the bank do not add these surcharges when using a debit card. The individual restaurant, retailer, or shop adds these fees.

“The ability to surcharge applies only to credit card purchases and only under certain conditions,” says a representative of Visa. “U.S. merchants cannot surcharge debit cards or prepaid card purchases.”

You cannot lump the surcharge into the service’s total cost when drafting an invoice or providing a receipt. Each surcharge must be listed separately on your invoice and labeled as a surcharge.

“Surcharges on debit cards are not allowed by Visa, Mastercard, or Discover Debit Cards, but many merchants impose them anyway. If you impose a debit card surcharge, are you doing so despite knowing it’s not allowed or unaware that it’s not allowed?” David Rayson, a consumer protection specialist.

“I realize that many small businesses pay ‘blended’ interchange through processors such as Square, Clover, or other payment processors, meaning that you pay the same flat rate (2.5% or more) on debit card and credit card transactions,” says Mr. Rayson. “However, just because you pay a blended interchange rate does not mean you can charge a fee for using a debit card. If you’re looking to save on card fees, you should do Interchange++ pricing instead, where you pay for the cost of each transaction rather than a blended rate.”

Interchange++ (IC++) is a pricing model for credit card transactions that breaks down the total cost of a transaction into three fees:

• Interchange fee: Charged by the bank that issues the card
• Card network fee: Charged by the credit card network, such as Visa or Mastercard
• Markup fee: Charged by the credit card processor, such as PayPal

IC++ is a popular and transparent model in North America and Europe. It’s an alternative to flat-rate pricing, which charges an average fee plus a fixed markup. With IC++, merchants only pay the interchange fee the card issuer charged them.

Why is it important to know that a merchant cannot charge you a fee for using your debit card? The answer is straightforward.

“It’s your money they are taking,” says Mr. Rayson. “Imagine a business does $10,000 a week in debit card transactions at a fee of 2.5%. That’s $250 a week or $13,000 a year in profit.”

A merchant or restaurant cannot claim ignorance that such surcharges are against federal law. Additionally, if they charge you a convience fee for using your debit card, that fee must be listed on your receipt as a separate line item.

“As part of the onboarding process,” says Jennifer Younger, “shop and restaurant owners are told that such fees are both against the law, under the Durbin Amendment, and a violation of Visa and MasterCard’s terms of service.”

So what can you do if you’ve been charged such fees? You can contact your card issuer or bank and let them know.

“I counsel everyone to report these fees to their bank or card issuer,” says David Rayson. I also advise you to contact the company’s card processor so that the business owner can be educated.”

Both David Rayson and Jennifer Younger say if you are going to be charged a debit card fee, you can speak to the manager about the Durbin Amendment of the Dodd-Frank Wall Street Reform and Consumer Protection Act and how both bar any fee being levied on debit card purchases.

“You can also make a report to the Federal Trade Commission, or your state’s Attorney General,” says David Ryson, “and they will reach out to the business, or the business owner, to correct them when they can and cannot collect fees.”

“Only you have the power to keep your money during these tight times,” says Jennifer Younger. Bring a copy of the Durbin Amendment and the Consumer Protection Act. Like I said, this is your money they are taking by utilizing illegal surcharge fees.”

Ms. Younger is correct; it’s up to us to make sure we do not overspend on junk fees.