SB 641

84(R) - 2015
Senate Business & Commerce
Senate Business & Commerce
Business, Industry, & Commerce

Companion Bill

HB 3442

Vote Recommendation

  • Negative
  • Neutral
  • Neutral
  • Negative
  • Negative


Charles Schwertner

Bill Caption

Relating to debit card or stored value card surcharges; providing a civil penalty.

Fiscal Notes

No significant fiscal implication to the State is anticipated.

Bill Analysis

Currently merchants are prohibited from imposing a surcharge on customers who pay with a debit card, as opposed to a credit card, cash, or check. SB 641 would modify the Finance Code (section 59.403) by instituting a civil penalty of $1,000 on those who knowingly level such a surcharge. The bill also adds a section to the code in which "surcharge" is defined.

Vote Recommendation Notes

We believe that merchants should be permitted to run their businesses however they wish and this includes affording them the ability to levy surcharges on those using debit cards. Generally this practice is undertaken to recoup losses incurred as a result of processing such cards, not out of any sort of malicious intent.

Banning businesses from recouping the debit card transaction processing fees will simply result in businesses passing the costs on to all customers by raising prices for everyone. As a result, the cost of the debit card fees would be paid by everyone, including those who pay cash. These types of unintended consequences are another reason why government should not get involved in regulating the day to day activities of private enterprise.

If enacted, SB 641 would strengthen a law which is already in opposition to the principle of free markets. We oppose SB 641.

Organizations Supporting

Credit Union Coalition of Texas
Independent Bankers Association of Texas
JP Morgan Chase