thread Re: Charge customer for transaction fees in Payments Troubleshooting

Charge customer for transaction fees

TNbuilding — Sun, 21 Sep 2025 05:43:38 GMT

Is there a way when creating an invoice to have the customer pay the square transaction fee?

Re: Charge customer for transaction fees

TheRealChipA — Mon, 07 Apr 2025 21:24:55 GMT

The answer right now is no, there is not. This is, because of the restrictions placed on Square by the card companies (Mastercard, etc), some cards are not allowed to be surcharged to recoup service fees — specifically debit cards, prepaid cards and gift cards. See screen shot below from the Square help document on service charges. It seems that Square is working on a solution that will satisfy the card issuers, but it’s not ready yet.

In order to ensure that customers are paying those fees, most of us just add a flat percentage to our item/service prices. I add 3% to my cost basis when I’m figuring out my costs to arrive at a sales price. And, yes, this means that cash paying customers pay these fees, too. In 10 years of doing this, not one customer has ever said a word. I usually come out a little ahead because of this — and that is the reason we are in business, eh? The best part about doing this is this is how we cost in everything else. People expect it. You do have the option (in most states, be sure to check your state’s laws) to discount customer who pay cash. But even if your state allows that, you have to post signs and notices, which usually makes card paying customers angry and feeling like second-class citizens. But, of course, that is your call.

Let me know if you have any other questions.

Re: Charge customer for transaction fees

Minion — Mon, 07 Apr 2025 21:28:47 GMT

Hey @TNbuilding

I was going to type out a lengthy response to your question, but if you click on this thread, it will give you way more information that I was planning on typing out. Good Reference thread.

Oh, welcome to the Square Community!

Re: Charge customer for transaction fees

TNbuilding — Mon, 07 Apr 2025 21:34:44 GMT

Oh ok. We rarely take credit card payments. I think we’ve had 3 in the past 2 years. I tried to add the cost in the total but that always just makes square take more.
ex. Item is 1770. Adding at 2.9% + 0.30 fee, makes the totals 1821.53.

Then when I put the total for that item as 1821.53, square takes more than the 51.23.
hope that makes sense.

Re: Charge customer for transaction fees

TNbuilding — Mon, 07 Apr 2025 21:37:45 GMT

Thank you. I read the thread and I may just move over to tranch.

Re: Charge customer for transaction fees

TheRealChipA — Mon, 07 Apr 2025 21:58:28 GMT

@TNbuilding I understand. But you are still coming out ahead because:

If you don’t increase your invoice amount, your deposit from the transaction will be 1770 - 51.63 =1,718.37
If you add in the fees, the deposit from the new invoice amount is 1821.63 - 53.13 =1,768.5

Yes, your Square fees are slightly higher, but you made more money on the transaction, overall. There’s nothing wrong with making a little profit, is there?

Also, I noticed that you mentioned you might switch. Of course, that is your prerogative. But don’t do that based on your guess that Square is the only card processor being monitored here. A year or two ago, there were articles about Visa fining and otherwise penalizing companies like Square because of illegal surcharging practices. It might seem like the grass is greener over there, but you might be just moving to another company that is doing this and not being as pro-active and above board as Square is trying to be now.

Re: Charge customer for transaction fees

Academic — Mon, 04 Aug 2025 23:59:01 GMT

so you're saying that its okay to ripoff your cash paying customers an extra 3% to cover your Square fees.. Are you aware that Square paid a hefty fine for being non-compliant and has reached out to their merchant base urging them to NOT LEVY A SURCHARGE ON CREDIT CARDS AND DEBIT CARDS? Are you aware that Square is not a registered acquirer, but a third-party platform for credit card processing? Square pays Paymentech their card fees, but Square is not a processor. When I run into Square merchants and they levy that 3% or 4% fee, then the Card Industry is notified. Square gets fined, and now they are fining their client base that charges card fees to the customers. Enjoy paying that $5000 fine when Square slaps you for being non-compliant.

Re: Charge customer for transaction fees

TheRealChipA — Tue, 05 Aug 2025 13:21:32 GMT

@Academic You have totally misunderstood. I charge what is needed to make a profit -- period. My products are priced to cover ALL of my expenses -- rent, CoGS, payroll, utilities, etc, etc, etc. Neither Square nor anyone else can control how I choose to price my products. If I choose to add 1% to cover the time it takes for me to do my accounting every morning, that is my business -- definitely not yours. I don't surcharge anything. I simply have a product pricing algorithm and determines how much I need to charge in order to ensure a profit. Since making a profit is the ENTIRE reason that any of us are in business, that is reasonable, legal and ethical.

Lose your attitude. You are not the boss nor the judge of me and you do not get to weigh in on the legal ways that I choose to make a profit. Worry about the beam in your own eye before you go looking for motes in mine. Trust me -- as long as I don't add a surcharge line on my transactions, Square (nor Mastercard nor Visa nor...) care how I go about making a profit.