Ten states have already prohibited merchants from charging a fee at the POS. Now eight more are thinking about joining the list.

According to a report by CUNA, the states of Hawaii, Illinois, Mississippi, New Jersey and Rhode Island are currently considering bills that would ban merchant surcharges. Two others — Pennsylvania and West Virginia — are currently crafting legislation. Vermont is mulling over the idea.

The CUNA story cites New Jersey Senator, Jim Whelan (D) as having said that surcharges represent "an undue burden on New Jersey families," that would "negatively affect New Jersey's growing consumer confidence."

The surcharge allowance is one aspect of the proposed anti-trust settlement between merchants and the major card brands. It went into effect last week, despite the fact that the settlement has yet to receive final approval of a judge.

Merchants in states where the surcharge is legal may collect a surcharge equal to the interchange fee charged to the merchant, up to a cap of 4 percent.

But what has been considered a major concession by the card brands has no value to merchants in states where the surcharges are banned — currently 20 percent of states. A total that could rise to 36 percent if the eight states currently entertaining the idea of a ban should join their ranks.

The 10 states with surcharge bans already in place are California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma and Texas.

Read more about regulatory issues.

 

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