AN ACT RELATING TO COMMERCIAL LAW -- GENERAL REGULATORY PROVISIONS -- INTERCHANGE FEES

SB 842 prohibits payment networks, banks, and processors from charging interchange fees (fees between banks for card transactions) on the tax or gratuity portion of a customer's payment. It directly affects merchants who process credit/debit card payments, requiring them to report tax and gratuity amounts during transaction authorization or settlement to avoid these fees. If merchants don’t report upfront, they can submit documentation within 180 days to receive refunds for improperly charged fees. Violations carry $1,000 penalties per transaction and require fee refunds to merchants. The law takes effect January 1, 2026.