Oklahoma Credit Card Surcharge Laws

Quick Summary:

• Oklahoma currently prohibits credit card surcharges but federal courts consider the law unenforceable
• New law takes effect November 1, 2025 that officially allows surcharges with specific requirements
• Maximum surcharge will be 2% or actual processing cost, whichever is lower
• Businesses must post clear disclosure at entry points and checkout
• Cash discounts remain legal and are often a safer alternative until November 2025

Oklahoma presents one of the most complex credit card surcharge situations in the United States. While state law technically prohibits surcharges, federal court decisions have made enforcement questionable, creating uncertainty for businesses. This confusion will end on November 1, 2025, when Oklahoma Senate Bill 677 takes effect, formally allowing surcharges with clear regulations.

Oklahoma law says that surcharges may not be imposed on any transaction where a consumer elects to pay by credit card in lieu of cash, check, or other means. Federal courts have invalidated this statute, saying that it's unconstitutional - meaning it's currently legal to surcharge credit cards in Oklahoma (even though Oklahoma law actually prohibits it). The new legislation will eliminate this legal uncertainty and provide clear guidelines for businesses.

Legal Disclaimer: This information is for reference only and does not constitute legal advice. Given Oklahoma's changing legal landscape, businesses should consult with an attorney before implementing surcharge programs.

Is Credit Card Surcharging Legal in Oklahoma?

The answer is complicated. Currently, Oklahoma law prohibits credit card surcharges under Section 14A-2-417 of the Oklahoma Consumer Credit Code, which states: "No seller in any sales transaction may impose a surcharge on a cardholder who elects to use a credit card or debit card in lieu of payment by cash, check or similar means."

However, Oklahoma's Attorney General issued an opinion on December 17, 2019, that concluded that the law would be declared unconstitutional if challenged following the 2017 decision by the U.S. Supreme Court in Expressions Hair Design v. Schneiderman. This creates a legal gray area where surcharges are technically prohibited but potentially unenforceable.

Starting November 1, 2025, this confusion ends. Oklahoma Senate Bill 677 officially repeals the surcharge ban and establishes clear rules for businesses wanting to implement surcharges.

What's Allowed

Current situation (until November 1, 2025):

• Cash discounts are explicitly legal - businesses can offer reduced prices for cash, check, or debit payments
• Surcharges exist in legal gray area - prohibited by state law but potentially unenforceable
• Federal court precedent suggests surcharges would be protected under First Amendment

Starting November 1, 2025:

• Surcharges up to 2% or actual processing cost, whichever is lower
• Clear disclosure requirements at entry points and checkout
• Applies to all business types - retail, professional services, restaurants, and online
• Cash discounts remain unlimited with no restrictions on discount amounts

What's Not Allowed

Both current and future law prohibit:

• Surcharging debit cards - illegal under federal law in all states
• Exceeding 2% or actual cost - strict caps prevent excessive fees
• Surcharging without alternative payment methods - must accept cash, check, or debit
• Hidden fees - disclosure requirements protect consumers from surprise charges
• Inconsistent application - surcharges must be applied uniformly

Penalty For Non-Compliance

Current enforcement is unclear due to the legal gray area, but potential consequences include:

• State consumer protection violations - Oklahoma Attorney General enforcement
• Federal court challenges - First Amendment protection for pricing disclosure
• Customer complaints - dispute resolution through Attorney General's office

Starting November 1, 2025:

• Clear violation standards under new Oklahoma law
• Consumer protection enforcement by Oklahoma Attorney General
• Civil penalties for non-compliance with disclosure requirements
• Card network penalties for violating Visa/Mastercard rules

How Surcharging Laws in Oklahoma Have Changed Over Time

Oklahoma's surcharge laws reflect a broader national evolution from prohibition to regulated acceptance.

1977 - Original Ban: Oklahoma's Consumer Credit Code Section 14A-2-417 was enacted, prohibiting surcharges on credit and debit card transactions. This reflected the consumer protection mindset of the era, preventing businesses from penalizing customers for payment method choices.

2019 - Attorney General Opinion: After federal courts struck down similar laws in other states, Oklahoma's Attorney General issued an opinion suggesting the state's surcharge ban would likely be unconstitutional if challenged. This created uncertainty but didn't change the actual law.

2025 - Legislative Reform: Oklahoma Senate Bill 677 was enacted on May 28, 2025, without Governor Kevin Stitt's signature. With the passage of SB 677, Oklahoma formally repeals its ban on credit card surcharges, eliminating potential uncertainty for sellers related to the enforceability of Oklahoma's no-surcharge law.

November 1, 2025 - Implementation: The new law takes effect, officially allowing surcharges with clear disclosure requirements and percentage caps. This positions Oklahoma alongside most other states in permitting regulated surcharging.

Surcharging vs. Cash Discounts in Oklahoma

Understanding the distinction between surcharges and cash discounts is critical for Oklahoma businesses, especially during the current transitional period.

Cash Discounts (Always Legal):Section 14-A-211 allows cash discounting, meaning merchants can legally charge customers less if they choose to pay by cash or check. The law expressly permits sellers to make available a discount for payment by means other than a credit card for all sales, service, and lease transactions, and it does not impose a limit on the amount of such discount.

Example: A restaurant could price menu items at $10.30 and offer a 3% discount for cash payments, effectively charging $10.00 for cash and $10.30 for credit cards.

Surcharges (Legally Complex Until November 2025):Traditional surcharges add fees to credit card transactions. Using a cash discount system instead of a surcharge fee is the safest option in Oklahoma until the new law takes effect.

After November 1, 2025: Both approaches become clearly legal, though cash discounts may remain more customer-friendly from a marketing perspective.

Is Debit Card Surcharging Legal in Oklahoma?

No, debit card surcharging is illegal in Oklahoma under both current and future law. This prohibition comes from federal law (the Durbin Amendment) and applies nationwide.

Oklahoma's current law explicitly includes debit cards in its surcharge prohibition. The new law taking effect November 1, 2025, maintains this federal requirement by only permitting surcharges on credit card transactions.

Important note: Even when processed as credit transactions (without PIN entry), debit cards cannot be surcharged. Businesses must have systems to distinguish between credit and debit cards to ensure compliance.

Oklahoma Credit Card Surcharge FAQs

Should Oklahoma businesses implement surcharges now or wait until November 2025?

Most experts recommend waiting until November 1, 2025, when the legal framework becomes clear. Using a cash discount system instead of a surcharge fee is the safest option in Oklahoma until then. Cash discounts are unambiguously legal and achieve similar cost recovery goals.

What's the maximum surcharge allowed under Oklahoma's new law?

Starting November 1, 2025, businesses can charge the lesser of (1) 2 percent of the total transaction amount, or (2) the actual cost charged to the seller to process the credit card transaction. This is lower than the federal 4% cap and Visa's 3% limit.

How must Oklahoma businesses disclose surcharges under the new law?

Sellers must "clearly and conspicuously" post the amount of the surcharge at both the point of entry and point of sale for in-person transactions and at the point of sale for online transactions. Phone transactions require verbal disclosure with all required information.

Can Oklahoma restaurants add automatic gratuities or service charges?

Yes, restaurants can add service charges, but they must comply with the same disclosure requirements as other surcharges. The new law doesn't create restaurant-specific exemptions, so standard surcharge rules apply.

Where can Oklahoma consumers file complaints about improper surcharges?

Consumers can file complaints with the Oklahoma Attorney General's Consumer Protection Unit by emailing ConsumerProtection@oag.ok.gov with "Complaint" in the subject line, or dispute charges directly with their credit card company.

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