The measure, signed by Louisiana Governor Jeff Landry in early June, is designed to prevent customers from paying unexpected additional charges when completing debit card transactions. The law applies to retail businesses, including online stores operating in the state.
Known as Act 751, the legislation introduces the state’s first regulation specifically addressing fees added to payment card transactions. Previously, Louisiana had no rules governing the assessment of these types of charges.
New Restrictions Target Debit Card Surcharges at Checkout
Under the new law, a surcharge is defined as any additional amount added during a transaction that increases the cost for a customer paying with a debit card. Businesses will no longer be allowed to add these extra charges to debit card purchases.
The rule applies to transactions made in physical shops as well as online stores across Louisiana. The change does not apply to credit card fees, which remain outside the scope of the legislation.
According to The Sun, the law was introduced to protect consumers from surprise fees that appear when they use debit cards for purchases.
Consumers Gain a Legal Path to Report Violations
Act 751 allows cardholders who believe a business has violated the law to take legal action, but they must first provide written notice to the retailer. The business then has 30 days after receiving the notice to resolve the issue and reimburse the affected customer.
If the violation is corrected within that period, no civil action can proceed. Lawsuits are limited to cases involving willful violations, repeated violations, or situations where the issue is not resolved within the required timeframe.
According to the details of the legislation, consumers will also be able to report alleged violations through a toll-free telephone number and an electronic reporting system that must be established by the Louisiana Attorney General.
Louisiana Attorney General Receives Enforcement Power
The new law gives the Louisiana Attorney General authority to penalize businesses that break the rules. The maximum penalty is set at $500 for each violation.
The measure arrives as regulators continue examining the impact of additional fees charged to consumers. According to the Federal Trade Commission, unfair and deceptive pricing practices involving hidden fees can harm consumers and disadvantage businesses competing on transparent pricing.
The FTC has also indicated that it is looking at ways to address these practices at the national level. Separately, New York City Mayor Zohran Mamdani is working on efforts to address hidden fees and subscription-related practices in the city.
Louisiana’s new requirements will begin applying to businesses on August 1, changing how debit card transactions are handled for shoppers across the state.
