A service fee is a fee charged to a customer who pays by card, allowed only for merchants in categories Visa permits. In the US those are government agencies, utility merchants and education merchants, or their third parties, in nine merchant category codes that include colleges, schools, and vocational and trade schools. The merchant must accept Visa in every channel it takes payments, disclose the fee as a service fee before the payment with a chance to cancel at no cost, and keep the fee a reasonable reflection of what accepting the card costs. It can't be combined with a surcharge or a convenience fee.
What is a service fee?
Visa's rules define a service fee as a fee charged to a cardholder who uses a card to pay for goods and services in a permitted merchant category. It is a separate program from a credit card surcharge and from a convenience fee, with its own list of who can use it.
Who can charge a service fee in the US?
In the US, Visa's rules allow a government agency, a utility merchant or an education merchant, or its third party, to charge one. The merchant has to be classified under one of these merchant category codes (MCCs):
| MCC | Category |
|---|---|
| 4900 | Utilities: electric, gas, water, sanitary |
| 8211 | Elementary and secondary schools |
| 8220 | Colleges, universities, professional schools and junior colleges |
| 8244 | Business and secretarial schools |
| 8249 | Vocational and trade schools |
| 9211 | Court costs, including alimony and child support |
| 9222 | Fines |
| 9311 | Tax payments |
| 9399 | Government services not elsewhere classified |
A business outside these codes can't charge a Visa service fee. Your processor can tell you which code you're classified under.
What rules does a service fee follow?
A merchant, third party or acquirer that charges a service fee must:
- Accept Visa in every channel where it takes payments, in person and online as applicable.
- Disclose it clearly as a service fee before the payment is completed, and let the customer cancel without a fee or penalty.
- Not present it as a fee charged by Visa.
How much can a service fee be?
Visa's rules don't set a US percentage. They say the amount must be:
- A reasonable reflection of the costs of completing the payment, such as your merchant discount rate, merchant service fee or other costs paid to third parties for accepting the card, and capped where possible.
- Flat, fixed, banded or ad valorem (a percentage), as applicable laws or regulations require.
- Charged on the final amount, after all discounts and rebates.
- Not added on top of a surcharge or a convenience fee.
An issuer can also file a compliance case against a transaction that carried a credit card surcharge and a service fee together.
How is it different from a surcharge and a convenience fee?
| Service fee | Credit card surcharge | Convenience fee | |
|---|---|---|---|
| Who can charge it | Permitted government, utility and education categories | Merchants generally, where state law allows | Merchants offering an alternative channel |
| What it pays for | The cost of the card payment | Accepting a credit card | An alternative payment channel |
| Amount | Reasonable reflection of costs | Lower of your rate or 3% | Flat |
| Can be combined with the others | No | No | No |
Does it matter for schools?
It can. Vocational and trade schools (8249), colleges (8220), business schools (8244) and K-12 schools (8211) are on Visa's US list. A school in one of those codes may be able to charge a service fee instead of a credit card surcharge. The two follow different rules, and one payment can't carry both. Check your own MCC with your processor and your state's law before you choose.
This page uses Visa's published rules. Mastercard and the other networks publish their own, and your processor applies them. General information, not legal advice.
- Visa Core Rules and Visa Product and Service Rules, 18 April 2026: section 5.5.3.1 (Service Fee Assessment Requirements, tables 5-6 and 5-7), section 5.5.1 (credit card surcharges), section 5.5.2.1 (convenience fees), section 11.12.4, and the glossary entry for Service Fee
- Visa: U.S. Merchant Surcharge Q and A
Every figure on this page was checked against these sources on Oct 6, 2026. General information, not legal or tax advice.