Surcharging 101: What Every Business Owner Should Know

You work hard to bring customers through the door, grow sales, and hit your revenue goals. Along the way, every expense affects how much your business keeps—including the cost of accepting credit cards.

Surcharging gives businesses a way to recover some of those costs. When implemented properly, it can help protect margins while giving customers clear information about their payment options.

A credit card surcharge is an additional fee applied when a customer pays with an eligible credit card. For example, if a permitted 2.5% surcharge applies to a $100 payment, the customer pays $102.50. The additional $2.50 helps offset the business’s card acceptance expense.

The amount you can collect is limited by applicable law, card network rules, and your acceptance costs. Understanding those limits is the starting point for a successful program.

Consider a business with $100,000 in monthly credit card volume eligible for a permitted 2.5% surcharge. That would generate $2,500 in gross surcharge collections each month, or $30,000 annually at the same volume. Actual net savings depend on processing charges, program expenses, refunds, and changes in how customers pay.

For an owner managing tight margins, that makes surcharging worth evaluating. Five fundamentals deserve attention before getting started.

  1. Credit and debit cards follow different rules. Visa and Mastercard prohibit surcharges on debit and prepaid cards. A debit card remains a debit card even when the customer selects “credit” at the terminal. Your payment system must identify which transactions are eligible. Visa’s merchant guidance, Mastercard’s rules
  2. The surcharge has a ceiling. Visa’s U.S. limit is the applicable merchant discount rate or 3%, whichever is lower. Mastercard’s published maximum is 4%, subject to acceptance-cost limits and other requirements. State law may impose a lower limit. Your provider should establish the permitted rate for your program. Visa’s limits, Mastercard’s limits
  3. Location matters. Rules vary across states. Connecticut generally prohibits payment surcharges. New York permits credit card surcharges within its limits but requires businesses to display the total credit card price, including the surcharge. A percentage-fee notice alone is insufficient there. Connecticut guidance, New York law
  4. Advance notice is required. Visa requires at least 30 days’ notice to your acquirer. Mastercard requires at least 30 days’ notice to Mastercard and your acquirer. Your processor may have additional requirements. Visa’s requirements, Mastercard’s requirements
  5. Customers need clear disclosure. Required notices must appear at the relevant entry and checkout points, and the surcharge must be separately identified on the receipt. Customers should understand the charge before paying. Visa’s disclosure requirements

Business owners should also understand the difference between surcharging and cash discounting. A surcharge adds a fee for eligible credit card use. A cash discount reduces an established price for a qualifying payment method. Convenience fees have separate requirements. The way a program operates determines which rules apply; changing the fee’s name does not change its substance. Explanation of payment-fee structures

The customer experience deserves as much attention as the rate. Explain the policy plainly, identify available payment methods that avoid the surcharge, and train employees to answer questions consistently. Clear pricing gives customers the information they need to choose how to pay.

Before launching, ask your provider to demonstrate how the system handles credit cards, debit cards, online payments, receipts, and refunds. Review the expenses your business will continue paying, including any debit processing, software, or program fees.

After launch, compare actual savings with your projections. Watch customer feedback, payment choices, and sales results so you can judge the program’s overall effect.

At Mosaic, the conversation starts with your business: your payment costs, your customers, and your goals. If you are considering surcharging, let’s explore what you could recover and how the right setup could support a clear, straightforward payment experience.

PCI 101: The Basics Every Merchant Should Understand

PCI stands for Payment Card Industry. Most merchants hear it in the phrase PCI DSS, which means Payment Card Industry Data Security Standard.

In simple terms, PCI DSS is a set of security requirements designed to protect payment card data. The PCI Security Standards Council says PCI DSS applies to entities that store, process, or transmit cardholder data, including merchants, processors, acquirers, issuers, and service providers.

For merchants, PCI is not just a compliance checkbox.

It is part of protecting customers, reducing breach risk, and keeping the ability to accept card payments.

Why PCI Matters

If a business accepts credit or debit cards, it has some level of PCI responsibility. That applies whether the business is a restaurant, retailer, healthcare office, e-commerce shop, service company, or mobile merchant.

Small merchants are included too. The PCI Council notes that PCI DSS applies regardless of size or transaction volume, although smaller businesses may have simpler environments and fewer systems to protect.

A data breach can create major consequences, including fraud exposure, customer loss, investigation costs, fines, higher processing scrutiny, and reputational damage.

What PCI Is Trying to Protect

PCI focuses on payment account data, especially cardholder data and sensitive authentication data.

Merchants should avoid storing raw card information whenever possible. If card data is stored, processed, or transmitted, the systems involved may fall into PCI scope.

Common ways to reduce risk include using:

PCI is not only about technology. It is also about people and process.

What Merchants Should Do Now

Merchants should review:

Merchants should also ask their processor or acquiring bank what PCI validation requirements apply to their business.

The Main Takeaway

PCI is the foundation of payment security.

For merchants in 2026 and beyond, PCI matters even more because payment environments are becoming more complex. Businesses may accept cards in-store, online, through invoices, through mobile devices, through apps, and through third-party platforms.

The practical recourse is simple: reduce where card data touches the business, use secure payment tools, train employees, work with trusted vendors, and keep PCI responsibilities current.

PCI is not just about passing a form. It is about protecting the payment trust that every merchant depends on.

Merchants Are Receiving MID Termination Notices. If You Got One, Time Matters.

For many businesses, payment processing is something that works quietly in the background.

Until it doesn’t.

Across the country, merchants are receiving notices that their Merchant IDs (MIDs) are scheduled for termination under Mastercard’s SCAM Merchant Monitoring Program (SMMP). For many business owners, the notice comes as a surprise—and the timeline to respond can be incredibly short.

If you’ve received one of these emails in 2026, you’re not alone.

More importantly, you may still have options.

What Is Happening?

Mastercard has expanded its monitoring of merchants that present elevated fraud and scam-related risk. Acquirers and processors are now required to take action when certain thresholds are exceeded.

The result?

Some merchants are receiving notifications that their processing relationship is ending because their MID no longer meets Mastercard’s program requirements.

In many cases, businesses are given only days to prepare before their account is closed.

For any business that relies on card payments, that can create a serious operational problem.

What Is an MID?

An MID (Merchant ID) is the unique identifier tied to your payment processing account.

Without an active MID, your business may not be able to:

For many companies, losing an MID doesn’t simply create an inconvenience.

It can bring revenue to a standstill.

Why Are Merchants Being Flagged?

Every situation is different, but Mastercard’s monitoring program generally focuses on businesses that show elevated risk indicators such as:

Sometimes business owners know exactly why they were flagged.

Other times, the notice is the first indication that a problem exists.

Industries That Should Pay Attention

While any merchant can be affected, several industries are experiencing increased scrutiny, including:

If your business operates in one of these industries, now is the time to understand your payment processing risk—not after receiving a termination notice.

Who Should Be Paying Attention?

This isn’t just an IT issue.

It’s a leadership issue.

The people who should understand how these changes affect the business include:

If payment acceptance is critical to your business, someone on your leadership team should already have a plan.

What Should You Do If You Receive a Notice?

First, don’t ignore it.

Waiting until your scheduled termination date dramatically reduces your options.

Instead:

  1. Review the notice carefully.
  2. Contact your current processor to understand the reason for the action.
  3. Gather recent processing statements and supporting information.
  4. Speak with a payments expert who understands high-risk underwriting and merchant placement.
  5. Begin exploring replacement processing immediately if necessary.

The earlier you act, the more flexibility you may have.

The Biggest Mistake Merchants Make

Many business owners assume they can start looking for a new processor after their account has been shut down.

Unfortunately, by that point, the transition becomes much more difficult.

Planning ahead gives you time to evaluate providers, gather documentation, and reduce the risk of interrupted payment acceptance.

How Mosaic Processing Can Help

At Mosaic Processing, we work with businesses every day that need guidance through complex payment processing situations.

If you’ve received an MID termination notice—or simply want a second opinion on your current processing relationship—we can help you:

Every merchant’s situation is different, but one thing is consistent:

Time matters.

Don’t Wait Until Your Business Stops Accepting Payments

If you’ve received an email stating that your MID is scheduled for termination, treat it as an urgent business issue.

The sooner you begin evaluating your options, the better your chances of maintaining uninterrupted payment acceptance.

We should talk about your MID.

Contact Mosaic Processing today for a confidential review of your payment processing situation. A brief conversation today could help protect your business tomorrow.