BACK

Your Business Credit

Can I impose a minimum transaction of $10 for card purchases?

Summary

If you’re a small business wanting to impose a minimum transaction amount, know the rules the card companies have to avoid trouble.

The editorial content below is based solely on the objective assessment of our writers and is not driven by advertising dollars. However, we may receive compensation when you click on links to products from our partners. Learn more about our advertising policy.

The content on this page is accurate as of the posting date; however, some of the offers mentioned may have expired. Please see the bank’s website for the most current version of card offers; and please review our list of best credit cards, or use our CardMatch™ tool to find cards matched to your needs.

Can my business require a minimum transaction of $10 to use a credit card?

Yes, federal law allows merchants to require a minimum transaction amount of up to $10, but beware of how it could affect your customer relationships.

Expert Q&A

Check out all the answers from our credit card experts.

Dear Your Business Credit,

I want to ask a question. I want to request that the minimum for credit card use is at least $10. Is it legal? – Suet

Dear Suet,
Yes. The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 permits businesses to impose a minimum purchase amount of up to $10 for credit card use, but the minimum must be the same for all credit card issuers and payment card networks.

Rules for imposing a minimum transaction

Additionally, the card processing networks have their own set of rules for imposing a minimum transaction amount.

There are some rules around this that are important for you and your staff to understand. For instance, with Visa cards, its merchant instructions say you can’t impose the minimum transaction on people who use debit cards. That may seem simple enough, but if a customer presses the credit key when swiping a debit card and your staff thinks it was a credit card transaction, you could end breaking the rules. As Visa pointed out, “it can get complicated if your staff doesn’t know how to differentiate between a credit card and debit card.” (The link above will point you to a page where Visa explains the difference.)

And while you are not obligated to disclose you have a minimum transaction, Visa says being clear about it is a best-practice that will help you to avoid confusion among your customers.

Mastercard has published similar rules. In its rules, Mastercard doesn’t allow merchant to set a minimum transaction for some of its cards but not for others, depending on the issuer. American Express has a similar policy.

Beware of harming customer relationships

As to whether you should impose a minimum transaction, that’s a different story. Often, merchants impose a minimum because on small purchases, the processing fees for credit cards can eat up the profits on selling an item, as I’m sure you’ve figured out.

However, you have to weigh the potential financial benefits of refusing small transactions against the fact that not accepting the cards will inconvenience some of your customers. Many people conduct almost all of their transactions electronically these days and don’t carry much cash. If you turn them away when they are in a pinch, they may decide to take their business elsewhere in the future.

If it is only a rare occasion when customers try to charge a very small purchase, then it may not be worthwhile to say no to them. What difference does it make if you don’t keep the profit on one can of soda a month? Where credit card processing fees can really add up for small merchants is in stores that do a high volume of transactions, such as gas-station convenience stores.

Other options for cutting transaction costs

To avoid having to turn people away, some merchants incentivize customers to buy more. For instance, you could run a classic, buy two, get one free promotion or something along those lines, or offer an attractive discount if customers buy a large size of a product you sell.

Consumers make many decisions based on emotion, including where to shop. The more welcome they feel, the more likely they will be to spend their money with you.

See related: Charging customers to use credit cards

What’s up next?

In Your Business Credit

Am I on the hook for my business’s credit card debt?

If you, the business owner, signed a personal guarantee to get your card, you are liable for the debt, even if your company closes.

Published: February 12, 2018

See more stories
Credit Card Rate Report Updated: December 4th, 2019
Business
15.09%
Airline
16.88%
Cash Back
17.38%
Reward
17.04%
Student
18.58%

Questions or comments?

Contact us

Editorial corrections policies

Learn more

Join the Discussion

We encourage an active and insightful conversation among our users. Please help us keep our community civil and respectful. For your safety, do not disclose confidential or personal information such as bank account numbers or social security numbers. Anything you post may be disclosed, published, transmitted or reused.

The editorial content on CreditCards.com is not sponsored by any bank or credit card issuer. The journalists in the editorial department are separate from the company’s business operations. The comments posted below are not provided, reviewed or approved by any company mentioned in our editorial content. Additionally, any companies mentioned in the content do not assume responsibility to ensure that all posts and/or questions are answered.