The simple hack to avoid credit card surcharges at cafes

If you feel like you’re increasingly being slapped with card surcharges – you’re not imagining it.

As businesses face rising costs, a growing number are charging their customers an extra fee when they pay by card to cover the cost of processing that transaction.

And while it might seem like a trivial amount in the moment, studies show that Americans lost $1.57 billion to credit card charges in 2023. 

But did you know there’s actually a way to avoid these sneaky transaction fees altogether?

And it doesn’t involve just paying for everything in cash (although that also works!)

How to avoid card surcharges

A recent TikTok video by Millie Muroi explains the surprisingly simple way you can dodge these fees.

“They’re usually only a few cents,” she begins, “but it can add up to hundreds of dollars over the course of the year. So we looked into if there was a way to reduce these surcharges.”

@theageaustralia

Sneaky transaction fees – with a nearly $1 billion price tag in Australia last year – are burning a hole in our wallets. Here’s how we fight them. #cash #card #surcharge

♬ original sound – The Age

She then explains that she’s about to buy a $4.20 coffee but will eliminate the surcharge by inserting or swiping her card.

“Usually, I tap it, but this is how you reduce the surcharge. So insert or swipe, choose the checking or saving option, put in your pin, and you’re good to go!”

Sure enough, she manages to avoid the surcharge this way and just pay for the cost of the coffee!

“Sick of paying just to use my card”

In the comments, people praised Millie for the tip, with one saying: “So sick of fees! Thank you.”

“This is so helpful, definitely going to give it a go next time. Sick of paying just to use my card,” another said.

“Oh this whole time I could have been doing this. K,” quipped a third.

However, others raised a few valid concerns.

“How do we do this if we pay with our phone?” someone asked.

“Some banking apps including bank of Melbourne and CBA now give you the option to pay using the app and when you tap to use either the credit or savings option as if you had the physical card,” replied one viewer.

Another pointed out: “In my experience, most surcharges will be added when the total is visible before tap/insert is done, so even if you choose to pay by savings, you’ll still be paying a surcharge.”

But someone replied, “That’s legal as long as they offer a surcharge-free option (like paying cash).”