As of April 2025, credit card surcharges remain legal in Virginia, but they are now subject to updated disclosures signed to protect consumers from hidden fees and misleading pricing.

Virginia has never prohibited surcharging outright, but starting July 1, 2025, new amendments to the Virginia Consumer Protection Act will require MSPs to clearly advertise or disclose any mandatory fees, such as credit card surcharges, before a transaction takes place. 

The fee must be tied to the cost of accepting credit cards, not applied to debit or prepaid cards, and must be disclosed to the client upfront.

For managed service providers (MSPs), understanding these rules is critical. Improper or unclear application of a surcharge could trigger civil penalties under consumer protection laws.

This article outlines Virginia’s current credit card surcharge rules and shares best practices for MSPs who want to pass on card fees responsibly. It also covers how automation tools make surcharge compliance easier to manage and document.

Disclaimer: This content is for informational purposes only and does not constitute legal advice. MSPs operating in Virginia should consult legal counsel and conduct their own due diligence before adding surcharges to client invoices.

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What is Credit Card Surcharging for MSPs in Virginia?

Credit card surcharging is a strategy that Virginia MSPs may use to offset the processing costs that can erode profitability, especially when clients pay significant or recurring invoices using credit cards.

Each credit card transaction incurs a fee, typically ranging from 2% to 4% of the transaction total.

Surcharging allows MSPs to recover some or all of those expenses by adding a clearly disclosed fee to credit card payments.

Under Virginia law, credit card surcharges are permitted as long as they are tied to the actual cost of processing and disclosed in advance. They must not apply to debit or prepaid card payments and must be capped in line with card brand rules—never more than 4% of the transaction total.

Here’s how this might look for a Virginia-based MSP:

Suppose you invoice a client $12,500 for managed IT services. You apply a 3% credit card surcharge for clients who choose to pay by credit card. 

The client agrees, and the total payment becomes $12,875. Without the surcharge, you'd have paid $375 in processing fees out of your own revenue. With the surcharge, that cost is fully covered—and you keep the full $12,500.

Even recovering modest amounts adds up quickly. Reclaiming $375 monthly from one client equates to $4,500 per year. Do that across four clients, and that’s $18,000 annually—revenue that would have otherwise gone to payment processors.

Whether you decide to pass on the full cost or just a portion, surcharging gives you a way to manage payment costs more intentionally, while staying compliant with Virginia’s disclosure requirements and industry regulations.

Understanding Credit Card Surcharging Laws in Virginia

Virginia currently permits credit card surcharges. However, as of July 1, 2025, all mandatory fees—including surcharges—must be disclosed upfront under newly amended provisions of the Virginia Consumer Protection Act. 

This means MSPs can’t advertise one price and reveal additional card fees only at the point of sale or on the final invoice.

Virginia does not impose a statutory cap on surcharge amounts, but card brand rules still apply. Surcharges must not exceed your actual cost of acceptance and can never be higher than 4%. 

For example, if your average transaction fee is 2.75%, you cannot legally impose a 3% surcharge—even if the higher amount seems negligible.

Not all transactions qualify for surcharging. Debit card and prepaid card payments are excluded under federal law, specifically the Durbin Amendment, which is a part of the Dodd-Frank Act. Even if a debit card is processed without a PIN, it still cannot be surcharged under current regulations.

Transparency and Legal Considerations of Credit Card Surcharging in Virginia

The legality of surcharging in Virginia is currently clear, but it remains vulnerable to change. 

In April 2024, the Virginia General Assembly passed HB 1519, a bill that aims to prohibit surcharges on electronic payment methods, potentially including credit card transactions. 

While the bill technically passed, it includes a reenactment clause—meaning it will only take effect if the General Assembly votes to enact it again in 2025, following a review by the Virginia State Corporation Commission.

Until then, surcharges remain legal, but with strict expectations around disclosure. Virginia’s new transparency rules require that any additional charge must be clearly presented before a transaction occurs. 

Failing to do so, or mislabeling the charge, could still be treated as deceptive conduct under the VCPA.

To maintain trust and stay compliant, MSPs in Virginia should:

• Disclose all surcharges upfront, whether in proposals, contracts, or online checkout environments
• Avoid vague or misleading terminology—the fee must be labeled as a credit card surcharge or processing fee
• Stay alert to legislative updates, especially regarding HB 1519’s potential reenactment in 2025

Federal and State-Level Guidelines on Credit Card Surcharging

At the federal level, credit card surcharging is permitted but regulated by both statute and card brand agreements. 

The state of Virginia adds another layer of compliance. Beginning July 2025, all surcharges must be included in the advertised pricing or clearly itemized at the time of presentation. 

If a consumer can’t reasonably avoid the fee—say, because no fee-free option is offered—then it qualifies as a mandatory fee and must be disclosed from the start.

Using a tool like FlexPoint makes this disclosure and compliance process easier. It allows you to configure your surcharge rate based on real-time transaction data, automatically restrict surcharges to eligible cards, and create compliant receipts and audit trails. 

With the legal environment subject to future shifts, FlexPoint gives you both consistency and flexibility.

Staying up to date with federal guidance, card network rules, and Virginia’s state-specific legislation is the best way to protect both your revenue and your client relationships.

Disclaimer: If you’re uncertain about how current or proposed rules may affect your MSP, consult legal counsel for help.

Implementing Credit Card Surcharging for Virginia MSPs

Even if your surcharge is technically legal, the way it’s communicated and applied will determine whether clients accept it or push back.

Clients should understand exactly why the fee exists, when it applies, and how it’s calculated. That means choosing a rate that reflects your actual processing costs and communicating it clearly at every step. 

Below are four steps to implement a surcharge policy that aligns with Virginia law, federal restrictions, and card brand rules while still preserving client goodwill.

Step 1: Establish a Clear Surcharge Policy and Structure

Before applying credit card surcharges, a Virginia MSP must develop a documented policy that outlines:

• The types of payments subject to surcharges
• How the fee is calculated (percentage or tiered)
• How your MSP complies with Virginia’s disclosure rules, card network limits, and federal restrictions like the Durbin Amendment

You must also comply with the newly amended Virginia Consumer Protection Act, which, beginning July 1, 2025, requires that any mandatory fees be clearly disclosed at the time prices are presented, not after.

Virginia MSPs may choose from different surcharge models, but each one must align with your actual cost of acceptance:

a) Flat Percentage Surcharge

This model applies the same rate to all qualifying invoices.

Example:

A 2.85% surcharge applied to a $8,700 invoice results in a $248 card fee. The client’s total becomes $8,948.

b) Tiered Surcharge Model

Fees vary depending on the invoice total.

Example:

• 2.4% for amounts under $4,000
• 3.2% for amounts of $4,000 and up

A $3,800 invoice would add $91.20, while a $4,500 invoice would include a $144 surcharge.

Step 2: Notify Credit Card Institutions and Clients

Before applying a surcharge, you must inform your payment processor and the credit card brands. 

For example, Visa and Mastercard both require 30 days’ notice before you can begin surcharging.

Once you’ve completed the notification process, the next step is to communicate with the client. Telling clients after a surcharge appears on their invoice is a surefire way to create friction—or worse, trigger chargebacks.

Be sure to include surcharge disclosures in all the following:

• Service agreements and contracts
• Payment terms and onboarding materials
• Client invoices and payment confirmation pages
• Any relevant sections of your website or billing portal

If a client receives a $9,200 invoice with an unexpected $276 surcharge (at 3%), and the fee wasn’t disclosed in writing, they may dispute the charge. Chargebacks can be costly. 

According to industry estimates from Swipesum, the average cost of a single chargeback, including lost revenue, penalties, and processing fees, is $190. Communication is the most effective way to avoid them.

Step 3: Update Invoicing Systems

Itemizing the surcharge on every invoice is not optional—it’s required. Under Virginia’s transparency standards and card brand rules, the surcharge must be shown as a separate line item directly tied to a credit card payment.

With Virginia’s new disclosure law taking effect in mid-2025, having the right invoicing system matters even more. Manual processes create opportunities for inconsistency or errors.

That’s where FlexPoint comes in. With automated surcharge tools, FlexPoint calculates the correct fee based on the card type, applies it only when necessary, and ensures it is displayed accurately on invoices and receipts. 

That means fewer client questions, less time spent troubleshooting, and a clear audit trail if your surcharge policy is ever challenged.

Step 4: Monitor and Review Compliance

Laws change, and so do card network rules and processing fees. MSPs in Virginia must regularly review their surcharge practices to remain compliant and competitive.

As of April 2025:

• Visa enforces a 3% surcharge cap
• Mastercard allows up to 4%, but only if that equals your actual MDR

Example: 

If your average Mastercard processing fee is 2.75%, that’s the most you can charge, even though the network allows up to 4%.

You also need to watch for changes in state law. 

While surcharging is currently permitted in Virginia, HB 1519, passed in April 2024, proposes a ban on surcharges for all electronic payment methods. It won’t take effect unless the General Assembly reenacts it in 2025, but if it does, that could make surcharges unlawful across all industries, including managed service providers (MSPs).

If the law is reenacted, failure to comply could expose your MSP to enforcement under the Virginia Consumer Protection Act, which allows civil penalties of up to $2,500 per violation.

The Role of FlexPoint in Streamlining Credit Card Surcharging

FlexPoint was built with the proper execution of surcharges in mind. It helps MSPs automate surcharge calculations, stay compliant with card brand rules, and meet Virginia’s evolving transparency requirements, without adding complexity to your invoicing process.

FlexPoint offers multiple options to structure card fees in a way that fits your service model.

a) Interchange+ Plan

There are times when passing fees to clients isn’t practical, such as when working with grant-funded organizations or government contracts that restrict billing adjustments. 

For those cases, the Interchange+ Plan offered by FlexPoint gives you the ability to absorb card processing costs internally while maintaining complete visibility into each transaction’s fee breakdown.

This plan bases the fee on the real-time interchange rate of each specific card. Although no surcharge is shown to the client, you can see exactly how much the transaction costs your MSP.

For example, if a client pays $7,800 using a high-reward American Express card and your processor charges 3.1%, you’ll incur $241.80 in fees. 

With Interchange+, you can track that expense by card type and use the data to inform future decisions about pricing or payment guidance.

The values here are clarity and predictability, without shifting costs to the client.

b) Customer Surcharge Plan

When your goal is to recover those card fees directly from clients, FlexPoint makes it easy to implement a surcharge policy that stays within Virginia law and card brand guidelines.

With this setup, your MSP can:

• Apply a flat-rate fee to credit card payments that reflects your actual cost of acceptance
• Automatically calculate and apply the automatic surcharge to each invoice
• Display the surcharge as a separate line on the invoice or receipt for complete transparency

The fee is clearly stated, leaving no room for confusion, and aligning with Virginia’s updated requirement to disclose fees before purchase.

What makes this model especially practical is that FlexPoint adjusts the surcharge automatically, so it’s only applied to eligible card types and never exceeds the limits imposed by card brands or your actual cost.

c) Shared-Cost Option

Not every MSP wants to pass 100% of the cost onto clients, and in some markets, a more balanced approach can go a long way in preserving loyalty. 

The shared-cost feature in FlexPoint lets you divide the fee between your business and the client in whatever proportion works best for your strategy.

Say your payment processor charges 2.6%, and you decide to recover 1.1% from the client while absorbing the other 1.5%. 

On a $5,700 invoice, the client would incur a $62.70 surcharge, and your MSP would cover the remaining $ 5,637.30. The client gains transparency, and you reduce the amount of processing expense deducted from your margin.

How FlexPoint Enhances Surcharging Compliance and Transparency

If you’re a Virginia MSP adding credit card fees to invoices, precision is key, especially with new legal expectations arriving in mid-2025.

State law will soon require that mandatory charges be included in the price shown upfront, not revealed during final billing. 

Combine that with card brand restrictions and federal debit card rules, and it’s clear: a careless surcharge could trigger more than a client complaint—it could lead to chargebacks or enforcement under the Virginia Consumer Protection Act.

The best way to stay within the lines? Let FlexPoint handle it for you. 

With built-in controls that prevent overcharging and automatic line-item breakdowns, FlexPoint ensures that every surcharge accurately reflects your true costs and is clearly labeled before payment is processed.

It doesn’t matter whether you pass through the entire fee, absorb part of it, or take on the full cost—FlexPoint adapts to your billing preferences while ensuring compliance across card brands and Virginia’s new consumer pricing rules.

Here’s how an invoice might look when generated using FlexPoint, with every detail handled correctly:

Notes
Thank you for your continued business. For any billing questions, contact [Your Contact Information].

FlexPoint’s Integration with MSP Tools for Seamless Billing

FlexPoint connects directly with the tools many Virginia MSPs already rely on, bringing billing, payments, and surcharge tracking into one streamlined platform: 

• QuickBooks Desktop
• QuickBooks Online
• Xero
• ConnectWise
• AutoTask
• HaloPSA
• SuperOps 

These integrations enable you to centralize your financial workflows and eliminate repetitive manual tasks. Rather than switching between systems to reconcile payments or check invoice status, your data flows into one location, saving time and improving accuracy.

Surcharges applied to credit card payments are also tracked on every invoice, giving your team a transparent record of exactly how much was charged, to whom, and why.

On the client side, FlexPoint provides a branded online portal that makes it easy for clients to manage their invoices and payments independently. 

The portal is designed with transparency in mind—clients can:

• Access and download itemized invoices
• Add or update credit card or ACH payment methods
• See any surcharge applied, clearly separated from service charges

This upfront visibility reduces billing questions, prevents misunderstandings, and reassures clients that surcharges are based on actual processing costs, not hidden fees. 

Offering Flexibility in Surcharging

FlexPoint provides Virginia MSPs with the flexibility to manage credit card surcharges at the individual client level, ensuring they're not locked into a one-size-fits-all policy. 

If a long-standing client has been with an MSP for several years and consistently pays large invoices on time, the MSP may decide to cover their card processing costs as a gesture of goodwill. 

On the other hand, they might apply a surcharge to newer clients or smaller contracts, where margins are thinner and cost recovery is more important.

With FlexPoint, this level of customization doesn’t increase your risk. 

The platform automatically applies surcharges where permitted, excludes debit card payments, and ensures that each fee is disclosed as required under the Virginia Consumer Protection Act, including the updated transparency requirements that take effect on July 1, 2025.

Each client’s billing preferences and surcharge eligibility can be configured directly in the system:

• Apply a pre-determined surcharge to one-off project clients
• Waive the fee entirely for partners with high annual contract values
• Split the cost with midsize accounts using shared-cost configurations

No matter how your policies vary from client to client, FlexPoint maintains full compliance and keeps your invoicing accurate and transparent.

Alternative Cost-effective Payment Method - ACH for Virginia MSPs

Although surcharging is a permissible and effective way to recover payment processing costs in Virginia, it's not the only path forward. 

Many MSPs are turning to ACH payments as a streamlined and affordable payment option that reduces backend costs without incurring any surcharges or regulatory complications.

ACH payments are particularly well-suited for recurring invoices, retainers, and project-based work. 

Unlike higher credit card transaction fees, ACH transfers typically cost between $0.25 and $1.00 per transaction, regardless of invoice size. There's no need to separate surcharge lines, monitor card type eligibility, or track caps set by Visa or Mastercard.

Even better, ACH is a client-friendly option. It removes friction at the point of payment, offering a straightforward process without additional charges or legal disclaimers. 

FlexPoint’s Same-Day ACH feature provides Virginia MSPs with faster access to funds compared to standard ACH timelines. Rather than waiting the typical three to five business days, funds can settle within the same day, helping you maintain healthier cash flow and tighter control over your accounts receivable.

Because FlexPoint integrates ACH directly into your billing environment, there's no need to juggle third-party tools, manually reconcile entries, or manually enter client data.

With FlexPoint, offering ACH is as simple to set up as it is to scale across your entire client base.

Conclusion: Reduce Processing Costs AND Maintain Compliance for Virginia MSPs with Credit Card Surcharging

With Virginia’s updated consumer protection rules taking effect on July 1, 2025, local MSPs must show all mandatory fees—like surcharges—before the client agrees to pay.

Invoices must also include the surcharge as a standalone line item, clearly labeling it to connect it to the use of a credit card directly. At the same time, card networks require advance notice and enforce strict rules around caps and eligibility. 

Missteps—whether through overcharging or lack of disclosure—can result in billing disputes or civil penalties under the Virginia Consumer Protection Act.

FlexPoint simplifies all of this. Explicitly designed for managed service providers, it automates surcharge calculations, prevents errors in invoice formatting, and handles disclosures at every stage of the payment process. 

Enhance your MSP’s bottom line and compliance with automated credit card surcharging solutions from FlexPoint. 

Stay within Virginia’s regulations and simplify your MSP payment processes using FlexPoint today.

Schedule a demo to see how FlexPoint can transform your financial operations and maximize profitability.

Additional FAQs: Credit Card Surcharging in Virginia for MSPs

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