There’s a lot of conflicting information on the web about Hawaii’s credit card surcharge laws. Some sources claim that Hawaii prohibits credit card surcharges, while others say it’s perfectly legal.
I’m going to clear up this confusion below to ensure you have accurate, up-to-date facts about surcharge fees in Hawaii.
Disclaimer: This information is for reference only. It’s not legal advice, and you should consult with an attorney to verify local laws before implementing a surcharge.
Are Credit Card Surcharges Legal in Hawaii?
Yes, credit card surcharging is legal in Hawaii.
Despite what you might read on certain websites, Hawaii does not currently have any state laws that prohibit or restrict merchants from adding surcharge fees to credit card transactions. Hawaii businesses can legally implement credit card surcharges as long as they’re compliant with federal regulations and card network rules.
The Confusion About Hawaii’s Surcharge Laws
So why is there so much misinformation about surcharging in Hawaii?
It’s all tied to bills that were proposed but were never enacted.
Hawaii lawmakers introduced SB 470 and SB 2745 in 2013-2014 legislative sessions. If passed, these bills would have added new sections to Hawaii Revised Statutes Chapter 481B “Credit Card Surcharges Prohibited.” The wording of these bills aimed to ban retailers from imposing surcharges when consumers paid via credit card instead of cash or check.
But these bills never actually passed and became law.
Any online source referencing these bills as the reason why it’s illegal for businesses to surcharge in Hawaii is incorrect. Surcharging is legal.
What the Current Law Actually Says
If you look at the current version of Hawaii Revised Statutes, there isn’t anything that prohibits credit card surcharges.
Chapter 481B (the proposed new chapter from SB 2745) covers unfair and deceptive trade practices. But it doesn’t include any language about anti-surcharge laws that were proposed in those 2013-2014 bills.
This means that Hawaii merchants can legally surcharge credit card transactions, just like businesses in most states.
Read More: Surcharge Laws in All 50 States
Maximum Allowable Surcharge Fees in Hawaii
Since Hawaii doesn’t have state-specific surcharge caps, merchants can default to federal maximums and card network limits:
- Federal maximum: 4%
- Visa maximum: 3%
- Mastercard maximum: 4% or actual cost of acceptance (whichever is lower)
- Practical cap: 3% to remain compliant with all major card networks
Most Hawaii merchants who implement surcharge programs stick to a 3% fee to ensure consistency across all card brands. This isn’t technically a “law” but the card networks require you to apply consistent treatment across all card types and brands (meaning you can’t surcharge Amex cards more than Visa cards).
Debit Card Surcharges Are Illegal
It’s illegal to surcharge debit cards in Hawaii.
This is a federal law that applies in all 50 states. It’s part of the Durbin Amendment to the Dodd-Frank Act.
Surcharge fees cannot legally be added to debit cards, prepaid cards, EBT/SNAP cards, and Kokua cards.
So if your business is planning to implement a surcharge program in Hawaii, you need to have policies in place to ensure you don’t apply surcharge fees to any of these cards.
Clear Disclosure is Required
Despite Hawaii not having any anti-surcharge laws, merchants still need to notify their customers about any surcharge fees prior to the transaction.
This aligns with the state’s consumer protection laws as well as federal laws on junk fees.
Essentially, you can’t bait and switch your customers by advertising one price and then charging them a higher price at checkout. Aside from taxes, any surcharges or convenience fees must be posted in advance.
This typically means posting notice at your point of entry and point of sale. And for some businesses (like restaurants), surcharge notices should be posted on menus and price sheets.
How to Report Surcharging Violations in Hawaii
If you’re a consumer in Hawaii and believe a local merchant is improperly surcharging transactions, you can file a complaint directly with Hawaii’s Department of Commerce and Consumer Affairs, Office of Consumer Protection.
Common violations include:
- Surcharges that exceed 4% of the transaction
- Surcharge fees on debit cards
- Failing to properly disclose surcharge fees prior to the transaction
Complaints can be filed online or mailed to:
Office of Consumer Protection
235 S. Beretania St., Room 801
Honolulu, HI 96813
And while we don’t offer any consumer-specific services here at MCC, we’d still like to hear about your experiences with surcharges in Hawaii.
So whether you’re local or on vacation, let us know if you experienced a surcharge fee and your thoughts about it. We’ll pass that information to businesses we work with throughout Hawaii.
Final Thoughts
Surcharging is legal in Hawaii. Despite many online sources claiming it’s not, those sites are mistakenly referencing anti-surcharging bills that never actually passed.
But just because it’s legal to surcharge credit cards in Hawaii, it’s still something that you need to carefully consider before rushing into. Consumers hate surcharges, and the cost of lost business will likely outweigh the 2-3% you recoup in processing fees.
Rather than passing your costs to customers, you can look for other ways to save money on credit card processing.Contact our team here at MCC for a free audit and assessment.
We’ll help you reduce your processing costs without switching providers or implementing a surcharge program.