Oregon Credit Card Surcharge Laws

Quick Summary:

• Credit card surcharging is legal in Oregon with no state-specific restrictions
• Oregon follows federal guidelines without additional state-level regulations
• Businesses can charge up to 4% (3% for Visa) or actual processing costs, whichever is lower
• Government entities have explicit authority to surcharge under state statutes
• Gas stations commonly use dual pricing models with cash discounts

Oregon provides one of the most business-friendly approaches to credit card surcharging in the United States. Oregon does not have state-specific guidelines on surcharges for businesses, so merchants can default to federal regulations. The only surcharge laws in Oregon's legal code pertain to government entities, giving them explicit permission to surcharge credit card transactions as a cost recovery method. But no laws in Oregon prohibit businesses from doing the same.

Unlike states with complex regulatory frameworks or outright bans on surcharging, Oregon's laws are straightforward for businesses and consumers alike. This regulatory simplicity makes Oregon particularly attractive for businesses looking to implement surcharge programs without navigating state-level bureaucracy, while still following federal consumer protection standards.

Legal Disclaimer: This information is for reference only and does not constitute legal advice. Surcharge laws can change, and businesses should consult with an attorney before implementing surcharge programs.

Is Credit Card Surcharging Legal in Oregon?

Yes, credit card surcharging is completely legal in Oregon. Oregon permits credit card surcharging as of February 2025, provided MSPs comply with state regulations, federal laws, and card network policies. The state does not impose additional restrictions beyond federal guidelines, making compliance straightforward for businesses.

Oregon follows federal law, which limits surcharges to 4% of the transaction amount or the merchant's actual processing costs, whichever is lower. However, card network rules effectively cap surcharges at 3% for Visa transactions, meaning most businesses operate within this limit to maintain consistency across all card types.

Oregon's regulatory approach emphasizes federal compliance while giving businesses maximum operational flexibility. This makes Oregon one of the most merchant-friendly states for surcharge implementation.

What's Allowed

Oregon businesses enjoy broad flexibility in implementing surcharge practices:

• Follow federal guidelines - 4% maximum surcharge or actual processing costs, whichever is lower
• Implement without state notification - no Oregon-specific licensing or registration requirements
• Use flexible disclosure methods - while card networks require notification, Oregon doesn't mandate specific formats
• Apply across all business types - retail, professional services, restaurants, and online businesses
• Combine with other pricing strategies - dual pricing, cash discounts, and convenience fees

What's Not Allowed

Federal regulations and card network rules still restrict these practices in Oregon:

• Surcharging debit cards - illegal under federal law (Durbin Amendment) in all 50 states
• Exceeding actual processing costs - surcharges cannot generate profit beyond cost recovery
• Hidden or surprise fees - customers must be informed before completing transactions
• Profiting from surcharges - fees can only recover processing expenses, not generate additional revenue
• Inconsistent card brand application - must apply uniform surcharge rates across different credit card networks

Penalty For Non-Compliance

While Oregon has no state-specific penalties, businesses face consequences through federal and industry channels:

• Card network penalties - Visa, Mastercard, and other networks can impose fines or terminate merchant accounts
• Federal consumer protection violations - FTC enforcement for deceptive practices
• Customer disputes - chargebacks and complaints through credit card companies
• Civil lawsuits - customers may pursue legal action for improper surcharging practices

Businesses making common mistakes include forgetting to notify processors and card networks, surcharging debit cards, profiting on surcharge fees, and failing to properly disclose surcharges to customers.

Surcharging vs. Cash Discounts in Oregon

Oregon businesses can choose between two primary approaches to offset credit card processing costs, and understanding the difference helps with both compliance and customer relations.

Surcharging adds fees to credit card transactions, typically displayed as a separate line item. This approach is legal in Oregon under federal guidelines, requiring proper disclosure and card network notification.

Cash Discounts/Dual Pricing provides reduced pricing for customers who pay with cash, check, or debit cards. It's common for gas stations in Oregon to use a dual pricing model. However, this isn't a requirement by law and it's not a credit card surcharge. The credit card price becomes the standard rate, while cash payments receive a discount from that price.

Gas Station Example: Oregon gas stations commonly display both cash and credit prices at the pump. The credit price is the baseline, and cash customers receive a discount (typically 5-10 cents per gallon). This approach is often more customer-friendly than traditional surcharging.

Both approaches are legal in Oregon, but dual pricing and cash discounts are typically seen at gas stations and may be perceived more favorably by customers who see discounts rather than additional fees.

Is Debit Card Surcharging Legal in Oregon?

No, debit card surcharging is illegal in Oregon and throughout the United States under federal law. The Durbin Amendment of the Dodd-Frank Act specifically prohibits surcharges on debit card transactions, regardless of how they're processed.

Oregon law doesn't prohibit businesses from charging debit card transaction fees on customers, but it does require them to clearly communicate the existence of the fee to customers in advance. However, this refers to convenience fees in specific circumstances, not surcharges in the traditional sense.

Important distinction: Convenience fees (for using non-standard payment methods) may be permissible on debit transactions in certain situations, but surcharges (fees specifically for using credit cards) cannot be applied to debit card transactions even when processed as credit transactions.

Businesses must have systems in place to distinguish between credit and debit cards to ensure federal compliance.

Types of Businesses That Must Follow Oregon's Surcharge Laws

All businesses accepting credit cards in Oregon must comply with federal surcharge regulations, with Oregon's minimal additional requirements making compliance straightforward:

Private Businesses - Retail stores, restaurants, professional services, and online businesses can implement surcharges by following federal guidelines and card network rules without Oregon-specific requirements.

Government Entities - State and local government offices have explicit authority to surcharge under Oregon statutes. Under ORS 825.502, the Oregon Department of Transportation may accept payment of taxes and fees by credit card, with the ability to add a surcharge to offset fees associated with acceptance costs. ORS 802.112 also says that any general government authority can impose a surcharge fee if a transaction can be processed in multiple ways and the customer chooses the more expensive option.

Gas Stations - Commonly use dual pricing models where cash payments receive discounts from the posted credit card prices. Yes, it is legal in Oregon and all other states for gas stations to charge different prices for credit and cash transactions.

Professional Services - Law firms, medical practices, and consulting businesses can add surcharges following standard federal compliance, with Oregon's lack of additional restrictions making implementation simpler than in many other states.

Online and Remote Businesses - E-commerce sites and service providers must follow federal disclosure requirements but benefit from Oregon's absence of state-specific notification or licensing requirements.

Oregon Credit Card Surcharge FAQs

Does Oregon require businesses to notify the state before implementing surcharges?

No, Oregon has no state notification requirements. Businesses only need to comply with federal regulations and notify card networks (Visa, Mastercard, etc.) as required by their agreements. Oregon's regulatory simplicity eliminates the bureaucratic overhead present in other states.

Can Oregon gas stations continue using dual pricing models?

Yes, dual pricing is completely legal in Oregon. Gas stations can display both cash and credit prices, with cash payments receiving discounts from the credit card price. This approach is often preferred by customers who see discounts rather than surcharges.

What's the maximum surcharge Oregon businesses can charge?

Oregon follows federal limits of 4% maximum or actual processing costs, whichever is lower. However, Visa's 3% cap means most businesses stay within that limit for consistency across card types. Oregon imposes no additional state-specific limits.

Do Oregon restaurants need special permissions for service charges?

No, restaurants can implement surcharges or service charges following the same federal guidelines as other businesses. Oregon's lack of restaurant-specific regulations makes implementation simpler than in states with special hospitality industry rules.

Where can Oregon consumers file complaints about improper surcharges?

Consumers can file complaints with the Oregon Department of Justice online or call the Attorney General's Consumer Hotline at 1-877-877-9392. They can also dispute charges directly with their credit card company under federal consumer protection laws.

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