NAPCP Addresses Surcharging Aspect of Card Networks’ Lawsuit Settlement

A Purchasing Card industry poll of card-using organizations reveals concerns over surcharging for electronic payments, but the NAPCP cautions against jumping to conclusions too quickly.

Mid-July reports about MasterCard, Visa and major banks settling a longstanding lawsuit to resolve claims in the multi-district interchange litigation (MDL) have flooded the news. Even though the settlement is still pending judge approval, the National Association of Purchasing Card Professionals (NAPCP) has been quick to offer guidance to its members—namely, the organizations that use Commercial Cards (e.g., Purchasing Cards, Corporate Cards) for business-to-business (B2B) payments. These organizations include corporations, colleges, universities, government entities, etc.

Of particular interest to these organizations is the element that would allow U.S. suppliers to impose a surcharge on Commercial Card payments. Such a practice has been historically prohibited in the U.S. per the card networks’ merchant rules; in addition, surcharging is outlawed in 10 states. Nevertheless, as the NAPCP’s education manager Lynn Larson shares, “To date, card-using organizations have still encountered suppliers wanting to surcharge. This is one reason why the NAPCP has always encouraged buying organizations to address card acceptance and related terms within supplier contracts. Yet, per research that we did a couple years ago with First Annapolis Consulting, 47% of survey respondents noted they seldom or never include such contract terms. These organizations might be more compelled to do so in the future if surcharging becomes a legitimate option.”

To gauge early response following news of the lawsuit settlement, the NAPCP offered a four-question poll to its members and complimentary subscribers. One question asked, “While the details related to the surcharging allowance are still unfolding, has your organization started to discuss how surcharging could impact your payment strategy?”

The majority of poll respondents (56%) said no. They might be taking a wait-and-see approach before expending energy on discussions, but some respondents’ comments indicate anxiety and/or a possibility of abandoning card usage in some cases. Larson cautions, “The worst thing organizations could do is have a knee-jerk reaction to surcharging. With help from their card providers, they need to look at the big picture—the benefits gained through card usage, such as process efficiencies and savings, and costs to suppliers. This industry news is an opportunity for buyers to have meaningful discussions with their suppliers to ensure a purchase-to-pay process that benefits all.” Fortunately, some poll respondents’ comments demonstrate a willingness to do just that. One stated, “We’ve begun discussions internally about how we are going to…spend much more time working out the benefits [of card acceptance] for both sides.” Another veteran respondent remarked, “Above all, collaborate with suppliers to avoid an adversarial relationship since the goal should be the best pricing and quality coupled with the most efficient means to reach that end.”

Members and complimentary subscribers are invited to review results to this and a full archive of polls that address topics including card providers; controls, compliance, audits; ePayables and payment strategies.

The NAPCP not only strives to keep its audience informed of important industry news like this and last year’s Durbin Amendment outcome, it offers additional insights and direction to help organizations make thoughtful business decisions. Because the cost of card acceptance has been such a hot topic, the NAPCP recently expanded its resources on interchange, revenue share (rebate) and more.


The National Association of Purchasing Card Professionals (NAPCP) is a member- and subscriber-based professional association committed to advancing Commercial Card and payment professionals and industry practices worldwide. We provide education, networking and a formal channel for connecting provider and end-user organizations.