Minnesota credit card surcharge rules for restaurants: 5 percent cap

Card processing is one of the biggest costs a restaurant cannot negotiate away at the counter. Some Minnesota owners add a surcharge to recover it, others offer a discount for cash, and many do neither. The state's statute on credit card surcharges sets conditions for each. This guide, checked in November 2026, reads Minnesota Statutes section 325G.051 as it appears on the Revisor's site, and notes where the newer price disclosure law raises a question. It is general information, not legal advice. Card network rules and your merchant agreement apply too, so read them before you change a price.

May a Minnesota restaurant add a credit card surcharge?

Yes, under conditions. The statute allows a seller to add a surcharge when a customer pays by credit or charge card instead of cash, check or similar means. The conditions differ by how the sale is made, and the surcharge may not exceed five percent of the purchase price. The statute covers credit and charge cards. The text read for this guide does not mention debit cards, and the card networks' own rules, which the owner's research puts at a ceiling of 3 percent, are tighter than the statute's five percent, so plan on 3 percent at most. Never surcharge a debit or prepaid card. Ask your processor how your terminal separates the types before you add any fee.

How must you disclose it in person?

For a sale made in person, the surcharge must be disclosed orally at the time of sale and on a conspicuously posted sign on the premises. Both parts are required. A sign by the door is not enough if the cashier never says it, and a spoken mention is not enough without the sign. For a restaurant that takes payment at the table, train servers to say it when they present the check, and post the sign where guests will see it before they order.

How must you disclose it online or by phone?

For website or mobile sales, a conspicuous surcharge notice must appear during the sale, at the point of sale, on the order summary or on the checkout page. For telephone sales, the surcharge must be disclosed orally. If you take orders by phone, write a short script that names the percentage before taking the card number. If you take orders on your website, show the surcharge as a line before the guest confirms.

What is a cash discount?

The statute says a surcharge is a fee that increases the price because the customer uses a credit or charge card, and a cash discount is not a surcharge if it is offered to all prospective customers and its availability is clearly and conspicuously disclosed to them. Many owners prefer the discount approach because it reads as a reward. Post the cash price and the card price on the menu or a sign, and apply it to everyone who qualifies.

Are there customers you may not surcharge?

A seller that establishes and is responsible for its own customer credit or charge card may not surcharge a customer who uses that card instead of cash, check or a similar means. A restaurant that issues its own house card should read that sentence carefully. The statute also applies to a seller's agent, so a catering partner or ordering platform that takes payments for you needs to follow the same rules.

What is the penalty?

A seller who violates the section is subject to a civil penalty of up to $500 and must refund the surcharge to each buyer. A system that adds a surcharge to every transaction without the proper disclosure could create a refund liability across hundreds of checks, so test the setup before service.

How does the junk fee law fit?

Minnesota's price law, added in 2024, says a business may not advertise, display or offer a price for goods or services that does not include all mandatory fees or surcharges, and it excludes government taxes from that. The sections read for this guide do not say whether a card surcharge that a customer can avoid by paying cash is a mandatory surcharge. Because the two laws were written at different times, ask a lawyer how they fit before you add a surcharge, and look for guidance from the Attorney General's office.

How do you explain the surcharge to guests?

A guest who hears about a fee for the first time at the register tends to feel tricked, so tell guests early and plainly. Put the percentage on the menu or a table card, say it when you take a phone order and show it on the receipt as its own line. Give staff one sentence to use when a guest asks why, and tell them to point to the cash price when there is one. Review the complaints you get in the first month. If the same question comes up again and again, change the sign, not the guest.

What should you do next?

Decide whether to add a surcharge, offer a cash discount or raise prices a little. If you surcharge, write the sign, the server script and the online notice, and ask your processor to test debit and credit separately. Cap the rate below five percent. Keep a copy of the wording and the date it started.

More guides for your business:

• Minnesota junk fee law: what it means for restaurant service charges
• Minnesota gift card law for restaurants
• Minnesota sales tax on restaurant meals: the state and local layers

More in the US guides for food businesses.