What Are Credit Card Convenience Fees?

Credit Card Convenience Fees Explained

A customer pays for a coffee with a credit card.

 Thomas Barwick / Getty Images

With an increase in direct deposit payments, debit cards, and credit cards, fewer people are using cash and checks for transactions. But when making a credit card payment to a business, it can be shocking to find the business charges a credit card convenience fee—a small flat-rate or percentage fee when you're making a credit or debit card transaction.

Is this legal? Are businesses allowed to charge a convenience fee to customers who just want to use their credit cards? In short, yes. But the specifics are governed by credit card network policies and state laws.

Definition and Examples of Credit Card Convenience Fees

A convenience fee is a fee that a business charges customers who use credit cards via a specific payment channel rather than a payment channel that's standard for the business. For example, a business that traditionally accepts in-person payments but has offered online credit card payments may charge an additional fee for that convenience.

How Do Credit Card Convenience Fees Work?

While credit card convenience fees are a nuisance and an additional expense for consumers, businesses that charge the fee often have a legitimate financial reason for doing so. Credit card processors, issuers, and networks charge a fee on every credit card transaction that businesses run. These fees add up to 2.87%-4.35%, on average, according to payment processor Square. Businesses may have to pay for the software and hardware for processing credit cards, in addition to administrative and bookkeeping costs, too. 

Rather than charging individual transaction fees, businesses that routinely accept credit cards typically build the cost into their prices. This is especially true for businesses such as major retailers that routinely sell products and services directly to the public.

Other businesses bill you directly only for the cost of certain services you've used, rather than padding credit card processing costs into the price you're charged.


Utility companies, landlords, and government entities often bill you directly for the amount you owe. With these businesses, it's likely free to pay by check or ACH. But if you want to use a credit or debit card to take care of your bill online, you may have to pay a convenience fee.

Convenience Fees vs. Surcharge Fees

Credit card convenience fees and surcharges are often used interchangeably, but they're not the same thing. A surcharge is a fee charged to customers simply because they're using a credit card. Most merchant credit card agreements prohibit merchants from charging surcharges on transactions.

Convenience Fee Surcharge
Charged for using a specific payment channel (online and phone, for example) Charged for using a credit card vs. other payment methods
Guided by card network rules Regulated by state law
  Limited to the fee the business is paying to accept a card

While credit card issuers may not be allowed to charge a surcharge on credit card transactions, they are sometimes permitted to offer a discount for customers who pay with cash. You may have noticed some gas stations, for example, have one price set for credit card payments and a slightly lower, discounted price for cash transactions.

Card Network Rules for Convenience Fees

Merchants that accept credit cards are bound by the agreements they have with the credit card networks like Visa, Mastercard, American Express, and Discover. These agreements outline the various things merchants can and can't do when accepting credit card payments. Networks have varying rules about whether merchants are allowed to can charge a convenience fee.


Visa allows convenience fees but generally only when the payment takes place on an alternate payment channel; the customer is informed of the fee ahead of time; and the merchant charges a flat rate for the transaction instead of a percentage.


Mastercard allows convenience fees if businesses impose the fees on all similar transactions, regardless of payment method.

American Express

American Express allows convenience fees when they are equally imposed on similar transactions (i.e., not a penalty for using a card). Any convenience fee must be clearly disclosed before payment, and the customer must have the option to cancel the transaction.


Discover doesn't have a policy on credit card convenience fees. Instead, the credit card issuer only requires that merchants treat all credit cards the same. That means merchants can't limit the charge to one network instead of all of them. For example, a business isn’t allowed to charge a fee for Discover credit card transactions but not Visa transactions.


Convenience fees may also be charged on debit card transactions, since these cards are often processed the same as credit cards when used online, over the phone, or at payment kiosks.

How to Avoid Convenience Fees

You can avoid a convenience fee by choosing an alternate payment channel. For example, if a business charges a convenience fee for online payments, you may have to make the payment over the phone, by mail, or in-person to avoid paying a fee. 

Another option for avoiding the fee is to check to see if a business waives the fee for loyalty club members. Movie-theater chain AMC charges a convenience fee for online ticket bookings, but you can waive it by becoming a paid member of the AMC Stubs loyalty club. 

Key Takeaways

  • Businesses charge a convenience fee to consumers who use an alternate payment channel like online or phone.
  • Convenience fees are regulated by credit card networks and allow businesses to pass along the cost of processing payments.
  • Surcharges are a different type of fee and charged specifically on credit card payments. Convenience fees, by comparison, may be charged on any payment method received on the alternate payment channel.
  • You can usually avoid convenience fees by paying via a checking account.
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The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.
  1. Square. "Credit Card Processing Fees and Rates Explained."

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