Compliance · California

Credit Card Surcharge Laws in California (2026 Guide)

California's original credit card surcharge ban is no longer enforceable, but a separate, newer pricing-transparency law makes the traditional “add a fee at the register” style of surcharging risky in practice.

Is it legal to surcharge credit cards in California?

The old ban is dead, but a newer law changes how surcharging has to work in practice. California Civil Code §1748.1, enacted in 1985, banned credit card surcharges outright. In Italian Colors Restaurant v. Becerra (9th Cir. 2018), a federal court ruled that ban an unconstitutional restriction on speech and permanently enjoined the state from enforcing it (California New Car Dealers Association legal memo).

But separately, California's Senate Bill 478 — the "Honest Pricing Law," effective July 1, 2024 — requires that any mandatory fee, including a credit card surcharge, be included in the advertised, upfront price a customer sees. A business cannot list a price and then add a surcharge on top of it at checkout; the full price, inclusive of the surcharge, has to be the number the customer sees from the start (California Department of Food and Agriculture guidance, Merchant Cost Consulting).

What this means in practice

A separate surcharge line added at the register, on top of an advertised price that didn't already include it, risks violating SB 478 — even though the old surcharge-specific ban is unenforceable.
Businesses can still recover card processing costs, but the cleanest compliant path is pricing that already bakes the cost into the displayed price — which is closer to a dual pricing structure than a traditional surcharge.
Cash discounts are unaffected by SB 478 and remain a clearly compliant way to offset costs.
Debit and prepaid cards can never be surcharged in California, the same as everywhere else, under federal law.
Violations of SB 478 can bring civil penalties enforced by the California Attorney General or through private lawsuits under the Consumers Legal Remedies Act.

How PayWavez can help

For California merchants, PayWavez generally recommends a compliant dual pricing program over a traditional bolt-on surcharge, since it structures pricing in a way that's designed to work with, not against, California's all-in pricing requirement. Talk to PayWavez before enabling either program in California.

Related guides

Credit Card Surcharge Laws & Compliance Rules — the full national rulebook.
How to Add a Credit Card Surcharge Legally — the six-step setup checklist.
Surcharging vs. Dual Pricing vs. Flat Rate — which pricing model fits your business.

Is it legal to add a credit card surcharge in California?

California's original surcharge ban (Civil Code §1748.1) was ruled unconstitutional and is unenforceable. However, a separate 2024 law, SB 478, requires all mandatory fees — including surcharges — to be included in the upfront advertised price, which restricts how a traditional register-level surcharge can be structured in California.

What's the safer pricing model for California merchants?

A compliant dual pricing program, which bakes the card-acceptance cost into the displayed price rather than adding it as a separate line at checkout, is generally the more conservative path under California's SB 478 all-in pricing requirement.

Not sure which pricing model fits California?

Talk to PayWavez about a compliant dual pricing program built around California's all-in pricing rules.