I think you can’t charge a fee, the service provider which is the credit card machine linked to a bank account is who issues you this fee, and which you pass to a customer. If a customer pays with a card I would let them know there is a fee.
In az several convinece stores have a mini to use debit or credit card. When the gas prices went through the roof 2 years agao several gas staions were charging an additional percentage to use a credit card. When the credit card companies got hit from everyone filing bankruptcy and all the forclosures going on our credit processor uped thier rates and told me to pass it along to the consumers. I gave my clients the choice pay by cash or check or to incurr the additonal expense if they wanted to use thier credit card. On big purchases like roller shades or enclosed patios $1000 and up the extra fee really adds up. Everyone picked paying by check. Apparently when they have to pay for those air miles they pass.
Charging a fee for credit card use is against the TOS of most credit card companies.
It’s not criminal but it could get your account yanked.
The workaround is to give cash/checks a discount and mark up your prices accordingly.
EXTRA CHARGE FOR USING A CREDIT CARD
Some merchants seek to impose a service fee for all credit card purchases.
When a merchant gives a credit card slip to the credit card company or bank for processing, a percentage of each purchase—usually 1.5% to 5% of the purchase amount—is deducted. This “merchant discount fee” helps pay for the bank’s services and for the credit card system. By charging extra for credit card use, the merchant passes the discount fee on to customers.
MORE: Since 1984, when a Truth in Lending law ban on surcharges expired, some states have enacted laws prohibiting surcharges; see States That Prohibit Credit Card Surcharges. The following states prohibit merchants from adding surcharges to credit card transactions
Visa and MasterCard prohibit surcharges, and American Express discourages them. Amex does prohibit “discrimination” against the Amex card, however, so if a merchant accepts Visa and MasterCard (and cannot impose a surcharge under those companies’ rules), the merchant may not discriminate against Amex by imposing a surcharge.
TIP: Any merchant that accepts American Express cards and also accepts Visa and/or MasterCard may not charge consumers a surcharge on Amex purchases.
OK, since the OP is in California then it is illegal.
Thanks for the relies all!
aintjemama: do you have any links to this info on a government site?