A new Louisiana law prohibits restaurants and businesses from adding surcharges to debit card transactions, requiring merchants to clearly disclose any valid fees to customers.
Customers react to hidden fees
Restaurant customer Keith Cowgill said extra charges at the register undermine the dining experience and can affect tips for waitstaff.
"It shouldn't have been allowed in the first place, in my opinion," Cowgill said. "You go to a restaurant, you enjoy yourself, you have a good meal and you tip. They shouldn't be adding little secret extras on it."
Cowgill said he supports the ban.
"I feel like it's very appropriate. Just don't be greedy. You can't put in hidden fees — if you're gonna do that, go work for a bank," he said.
Industry draws distinction between surcharges and cash discounts
Payment industry representatives say the new law highlights a broader confusion between two separate practices. Toby Okafor, an employee with Global Payments, said surcharging applies only to credit cards, while debit cards are treated as cash transactions.
"People think surcharge is the same for both. It's not," Okafor said. "Surcharging is only applied to credit cards; debit cards count as cash transactions. Cash discount is entirely different — it removes all processing fees from the merchant side."
Okafor said customers who are charged a fee for using a debit card can and should dispute it. He said the focus for both merchants and customers should be transparency.
"I really just think it's a matter of educating the merchants and them knowing what it is they're putting on their customers and being as fair as possible," Okafor said. "It's just a matter of transparency. At the end of the day, that's really it."
