Learn about AR Automation's surcharge functionality

A surcharge fee is an additional fee added by a merchant to a transaction when a customer uses a credit card for payment. A surcharge fee is applied to cover the costs of accepting credit cards. Merchants who choose to surcharge must follow consumer disclosure and other requirements.

Implementation Rules

Before you enable surcharging on your account, please keep the following considerations in mind.

Payment Methods

The surcharge can be applied to transactions processed through credit cards only. Additionally, surcharging depends on the customer’s location:

  • Customers whose billing country is the US may have a surcharge applied on credit cards only (not applicable for debit/prepaid cards).
  • Customers whose billing country is Canada may have a surcharge applied on credit cards only (not applicable for debit/prepaid cards).
  • Customers whose billing country is Australia may have a surcharge applied on credit, debit, and prepaid cards.

The card schemes that allow surcharging are Visa, MasterCard, Amex, and Discover.

Territories Requirements for Surcharge

Shopper Location Prohibitions

Surcharging is allowed for shoppers from Australia, Canada, and the US. Certain US states and territories prohibit surcharging (Connecticut, Maine, and Puerto Rico).

States that allow surcharging:

  • AL  Alabama
  • AK  Alaska
  • AZ  Arizona
  • AR  Arkansas
  • CA  California
  • CO  Colorado*
  • DE  Delaware
  • FL  Florida
  • GA  Georgia
  • HI  Hawaii
  • ID  Idaho
  • IL  Illinois
  • IN  Indiana
  • IA  Iowa
  • KS  Kansas
  • KY  Kentucky
  • LA  Louisiana
  • MA  Massachusetts
  • MD  Maryland
  • MI  Michigan
  • MN  Minnesota
  • MS  Mississippi
  • MO  Missouri
  • MT  Montana
  • NE  Nebraska
  • NV  Nevada
  • NH  New Hampshire
  • NJ  New Jersey
  • NM  New Mexico
  • NY  New York
  • NC  North Carolina
  • ND  North Dakota
  • OH  Ohio
  • OK  Oklahoma*
  • OR  Oregon
  • PA  Pennsylvania
  • RI  Rhode Island
  • SC  South Carolina
  • SD  South Dakota
  • TN  Tennessee
  • TX  Texas
  • UT  Utah
  • VT  Vermont
  • VA  Virginia
  • WA  Washington
  • WV  West Virginia
  • WI  Wisconsin
  • WY  Wyoming

*State law permits a 2% threshold for credit card purchases

Shopper Location Validation

The location validation for your customers is based on country, state, and postal code values.

For manually initiated payments through Payment Links the address must be submitted by the customer on the checkout page. For auto payments, the address is taken from the address field of the default billing contact.



If your AR Automation account is connected to an accounting system, the default billing contact information is taken directly from the accounting system.

Address Value Validation

The value of the country field can be validated based on the country code. Refer to our list of countries with valid country codes here.
The value of the state field can be validated based on the state abbreviation. Refer to our list of countries with valid state abbreviations here.



Make sure the address information for default billing contact is submitted in a valid format. If the shopper’s country, state, and/or postal code cannot be validated (i.e. submitted country/state value on the contact form is invalid), the surcharge fee won’t be calculated and added to the transaction amount. Additionally, if no address information is submitted for default billing contact, the surcharge fee won’t be applied to the original payment.

Displaying the Surcharge Fee

Payment Links

The surcharge fee value is displayed on the Payment Links as a separate line after submitting the billing address and card number. This means the customer will see the payment amount and surcharge fee before processing the payment. If the customer’s payment method or billing address is not allowed for surcharging, no fee accrual will be displayed.

AR Account

The surcharge fee value is displayed on the Payment List page in a column named fee, as well as on the Payment Details page.

If no surcharge was applied, the fee field displays a $0.00 value, and hovering your mouse over the field will display the reason for surcharge non-accrual.


The surcharge must be disclosed on the checkout page, stating that a surcharge of x% will be applied for paying with a credit card. In addition, surcharges must be displayed as a separate line item on a receipt. If the surcharge is enabled on your account, we will add disclosure messages on the Payment Link and Pay Balance Link pages as well as on the checkout page where the shopper submits payment data.

Surcharge Notice

The surcharge notice below is added to the checkout page:


Surcharge Notice

We impose a surcharge of **____**% on the transaction amount on Visa, MasterCard, AMEX and Discover credit card products, which is not greater than our cost of acceptance. We do not surcharge Visa, MasterCard, AMEX and Discover debit cards.

Disclosures for Auto Payments

The surcharge fee can be applied to auto payments, and it is important to make sure that your customers that have payments processed automatically are aware of the surcharge fee accrual.

We suggest two methods for informing your customers about surcharging:

  1. You may add the disclosure message to your default invoice terms field. (go to the Settings page > select Preferences > select the Invoices tab > fill in the Default Terms input field.
    Note: The Default Terms field is displayed on the invoices created in AR Automation with one of the default invoice templates. If you are creating invoices in your accounting system and using an accounting system template, you need to make sure that you have the relevant invoice field in your accounting system where you can submit a disclosure message.
  2. You can send an email or letter to notify customers prior to surcharging. You can create a cadence communication or manually send the email to each individual customer. The cadence step condition On a Particular Date is a good option for this.

Disclosure Message Requirements

You can use the same disclosure message as the one on your Payment Links, but it doesn’t have to be the same exact wording. Your shoppers must understand that they will be charged a surcharge fee and the cost of the surcharge fee. Disclosure requirements and sample compliant signage can be found here.

Auto Payment Cancellation

According to card schemes' policies, merchants who surcharge must notify shoppers and must give them an opportunity to cancel payment prior to completing a purchase. If you have the surcharge setting enabled, your customers must be able to disable the auto payment setting through the Customer Portal.



If the customer disables the auto payment setting on the Customer Portal, all scheduled auto payments for the customer will be canceled unless the customer re-enables the auto payment setting.

Surcharge Rate Value

The surcharge fee rate must be the same for all transactions from a card brand, regardless of the issuer.

The surcharge amount can be a fixed or variable amount, but it must be no greater than your average discount rate for that specific brand’s credit card transactions. In any event, the surcharge cannot exceed certain thresholds, as defined by the card, country, and state law. If your discount rate is different for all card brands you are accepting, we will set the lowest rate as the surcharge fee rate for all card brands. For example, if a merchant’s average discount rate is American Express 3%, Discover 2.5%, Mastercard 2%, and Visa 1.5% then the 1.5% for Visa would need to be used for all. Our Implementation Team will help you determine your discount rate and set up the surcharge rate value. Please contact support by emailing [email protected].

Card Brands Registration

If you wish to enable surcharging, you must notify Mastercard and BlueSnap of your intent to surcharge in writing, at least 30 days in advance of applying a surcharge. Our Implementation Team can assist you with the card schemes surcharge registration process. Please contact support by emailing [email protected].

Refund and Return Policy

To comply with card brands' requirements, you must display links to your refund and return policies on the payment receipt. You can add the refund and return policy on the Preferences page, under Surcharge in the Refund and Return Policy field.

Payment Receipt

If you surcharge your customers, you should send a payment receipt to your customers that contains all payment data required by card schemes. To be able to surcharge you must have the setting Send Payment Receipt enabled. You can turn on this setting by selecting the checkbox next to Send Payment Receipt on the Preferences page under Payments.

If the setting is enabled, AR Automation will send a payment receipt email for all payments processed through AR Automation. The email will be delivered to the default billing contact and all contacts with the setting Copy on messages enabled.



A payment receipt can be triggered for payments processed by CC, ACH, and SEPA only and is compatible with all card types. A payment receipt email can only be triggered for payments processed through AR Automation/BlueSnap.


Payment Receipt Mockup

Refunds and Surcharge

If you are processing a refund for a transaction that has a surcharge fee accrued, the surcharge fee will be refunded accordingly. On a partial refund, the corresponding percentage of the surcharge fee will be returned to the customer.

Surcharge Enabling

The surcharge feature can be enabled/disabled on both the company and customer levels.

To enable/disable surcharging on a company level, go to Settings, then Preferences, then check the Calculate Surcharge on Payments setting.

To enable/disable surcharging on a customer level, go to Customer, then Customer Record, then enable/disable the Surcharge setting.

The surcharge fee rate must be set up by the AR Automation team. Please contact support by emailing [email protected].

Passing Surcharge Value to BlueSnap Reports

The surcharge fee value is passed to BlueSnap reports in metadata fields, so your reports will display new report columns reflecting the surcharge fee value. The data will be passed to BlueSnap with the following meta field values:

metaKeySurcharge Applied
metaValueFee Value (XXX)
metaDescriptionSurcharge Fee Amount

Merchant Surcharge FAQs

Do I have to impose a surcharge?

No, it is entirely up to you whether or not to impose surcharge on payments.

Can I impose a surcharge on all payment methods?

No, only card transactions are subject to the surcharge fee.

Can I surcharge payments processed automatically by Auto Payment Rules?

Yes, but you must make sure that your customers are clearly informed about surcharging prior to the charge.

Do I need to inform all customers about imposing a surcharge?

Your customers must be aware of any surcharge. If surcharge is enabled for your AR Automation account, we must display a disclosure message on the Payment Link in order to comply with card brand regulations. The disclosure message states that the surcharge is only applicable to card payments.

If you are going to run payments automatically with the surcharge fee, you may send over disclosure messages only to customers who have a credit card on file.

Can I surcharge a flat amount?

Yes, the surcharge amount can be a fixed or variable amount. It must not exceed your credit card acceptance cost.