New Credit Card Fees Are Illegal In Colorado

DENVER (CBS4) - Thanks to a settlement with Visa and MasterCard the companies are lifting their bans on merchants passing on surcharges to customers.

Stores now have the option of charging customers up to four percent to cover the cost of processing a transaction.

"Many large retailers around the country, even in the states that permit it, will not charge the surcharge. It's part of a cost of doing business and it could alienate customers," Brent Neiser with the National Endowment For Financial Education said.

Those surcharges are illegal under Colorado law, so no business located the state can impose a fee.

Nine other states have similar bans, but consumers might have to pay it if they make a purchase online or on the phone with an out-of-state company where the fees are legal, or if visiting a business in one of those states.

Merchants will be required to clearly post at their cash register or online if they charge the fee.