Maine Credit Card Surcharge Laws

Quick Summary:

• Credit card surcharging is prohibited for all private businesses in Maine
• Government entities only can impose surcharges on credit card payments
• Businesses can offer cash discounts and use dual pricing legally
• No surcharge exemptions for small businesses or specific industries
• Violations enforced by Maine Bureau of Consumer Credit Protection

Maine stands as one of only four U.S. states that completely prohibits private businesses from adding surcharges to credit card transactions. Under Maine's Consumer Credit Code Title 9-A, Section 8-509, any seller in a sales transaction cannot impose additional fees on customers who choose to pay with credit or debit cards instead of cash, check, or similar payment methods.

The law creates a unique exception for government entities, allowing state agencies, municipalities, and educational institutions to charge convenience fees for credit card payments. This means Maine residents may encounter surcharges when paying property taxes, vehicle registrations, or college tuition, but never when shopping at private retailers, restaurants, or service providers.

Legal Disclaimer: This information is for reference only and does not constitute legal advice. Maine's surcharge prohibition is strictly enforced, and businesses should consult with an attorney before implementing any payment fee structures.

Is Credit Card Surcharging Legal in Maine?

No, credit card surcharging is illegal for private businesses in Maine. Maine Consumer Credit Code Title 9-A, Section 8-509 explicitly prohibits sellers from imposing surcharges on customers who elect to use credit or debit cards instead of cash, check, or similar payment methods.

Maine defines a surcharge as "any means of increasing the regular price to a cardholder that is not imposed on a customer paying by cash, check or similar means." This broad definition makes Maine one of the most restrictive states for credit card fee policies, leaving businesses with limited options for recovering processing costs.

The law applies to all private businesses operating in Maine, regardless of size, industry, or transaction volume. Unlike some states that allow surcharging with disclosure requirements, Maine provides no exemptions or workarounds for private merchants.

What's Allowed

Maine businesses can implement these legal alternatives to surcharging:

• Offer cash discounts from the regular listed price for non-card payments
• Use dual pricing showing separate cash and credit card prices side by side
• Include processing costs in base pricing for all customers
• Prominently display any discount pricing to ensure transparency
• Accept alternative payments like ACH transfers, checks, or digital wallets

What's Not Allowed

Maine law strictly prohibits these practices for private businesses:

• Adding surcharges to credit or debit card transactions of any amount
• Increasing listed prices for customers who choose to pay with cards
• Hidden processing fees regardless of disclosure method
• Convenience fees for online or telephone credit card payments
• Percentage-based additions to credit card transactions
• Flat dollar surcharges on any credit card payments

Penalty For Non-Compliance

Maine enforces its surcharge prohibition through multiple mechanisms:

• Maine Bureau of Consumer Credit Protection investigates violations and can impose civil penalties
• Consumer complaints filed through the Maine Attorney General's Consumer Protection Division
• Cease and desist orders requiring immediate discontinuation of surcharging practices
• Restitution requirements forcing businesses to refund improperly charged amounts
• Civil penalties and potential legal action for continued violations

Maine consumers can report surcharge violations by calling the Attorney General's Consumer Information line Monday through Thursday, 9:00 AM - 12:00 PM, or filing complaints online through the official consumer protection portal.

Government Entity Exception in Maine

Maine's surcharge prohibition includes a significant exception that allows government entities to impose surcharges on credit card payments. This exception covers state agencies, municipalities, counties, educational institutions, and other public entities when collecting various fees and obligations.

Government entities authorized to surcharge include:

• Municipal offices for property taxes, vehicle registrations, and permit fees
• State agencies for licensing, regulatory fees, and service charges
• Educational institutions for tuition, fees, and other student charges
• Court systems for fines, penalties, and filing fees
• Utility authorities for bill payments and connection fees

According to Curtis Picard, president and CEO of the Retail Association of Maine, this creates an inconsistent policy where "the state of Maine gave themselves permission to allow a surcharge" while prohibiting private businesses from implementing similar practices.

This government exception often surprises Maine residents who encounter surcharges when paying taxes or registrations but never see them at private businesses. The policy reflects Maine's consumer protection philosophy while acknowledging the practical needs of government operations.

Surcharging vs. Cash Discounts in Maine

Maine law carefully distinguishes between prohibited surcharges and permitted cash discounts. Understanding this distinction is crucial for businesses seeking to offset credit card processing costs while remaining compliant with state law.

Cash discounts are legal when:

• The regular price is clearly posted and applies to credit card payments
• Cash customers receive a reduction from the posted price
• Discount pricing is prominently displayed for all customers to see
• The credit card price represents the standard rate, not an increased amount

Example of legal cash discount: A restaurant posts menu prices that apply to credit card payments. A sign prominently displays "5% discount for cash payments." Cash customers pay less than the posted price, while credit card customers pay the posted amount.

Example of illegal surcharge: A restaurant posts lower "cash prices" and adds fees for credit card payments, or lists base prices and adds credit card processing fees at checkout.

The key distinction lies in whether customers pay more than the advertised price (illegal surcharge) or less than the advertised price (legal discount). Maine businesses must structure their pricing to avoid any appearance of adding fees to credit card transactions.

Types of Businesses Affected by Maine's Surcharge Ban

Maine's surcharge prohibition applies universally to all private businesses operating within the state, creating compliance requirements across every industry and business model.

Businesses subject to Maine's surcharge ban:

• Retail establishments including stores, gas stations, and service providers
• Restaurants and food service from fast food to fine dining establishments
• Professional services such as attorneys, accountants, consultants, and medical practices
• Contractors and trades including construction, plumbing, electrical, and landscaping services
• Online retailers selling to Maine customers regardless of business location
• Service industries like automotive repair, salons, and entertainment venues

The law makes no exceptions for business size, transaction volume, or industry type. Small businesses operating on thin margins face the same restrictions as large corporations, requiring them to either absorb processing costs or implement legal alternatives like cash discount programs.

Some industries face particular challenges under Maine's law. Restaurants cannot add credit card fees to large catering orders, contractors cannot surcharge expensive invoice payments, and professional services cannot offset processing costs on substantial client payments.

Maine Credit Card Surcharge FAQs

Can Maine restaurants charge extra fees for credit card payments on large catering orders or group dining?
No, Maine restaurants cannot add any surcharges to credit card payments regardless of order size or party size. They can offer cash discounts from their posted menu prices, but the menu price must apply to credit card payments. Any additional fees for credit card use would violate Maine's Consumer Credit Code.

Are Maine gas stations allowed to display different prices for cash and credit purchases?
Yes, Maine gas stations can use dual pricing showing separate cash and credit prices, similar to practices in other states. However, the credit card price must be the "regular" price, and the cash price must represent a discount. They cannot advertise low cash prices and then add surcharges for credit card payments.

What can Maine contractors do about high processing fees on large invoice payments?
Maine contractors must either absorb credit card processing costs or build them into their base pricing structure. They cannot add surcharges to credit card payments but can offer discounts for payments made by cash, check, or ACH transfer. Many contractors encourage ACH payments or require deposits via non-card methods.

Do Maine's surcharge laws apply to online businesses located outside the state?
Maine's surcharge laws apply to all sales transactions involving Maine residents, regardless of where the business is located. Out-of-state retailers selling to Maine customers should avoid adding Maine-specific credit card surcharges to remain compliant with state consumer protection laws.

Can Maine businesses charge convenience fees for online or phone payments?
No, Maine businesses cannot charge convenience fees for credit card payments made online, by phone, or through any other method. The law prohibits any means of increasing the regular price for credit card users, regardless of the transaction channel or additional convenience provided.