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North Dakota Enacts Law Allowing Convenience Fees on Credit Card Payments

Buckley LLP has news that the governor of North Dakota has signed a bill into law that will allow collection agencies to charge a convenience fee when processing a payment with an individual’s credit card.

The bill — House Bill 1204 — will go into effect on Aug. 1.

If charging a convenience fee, collection agencies must keep it to less than 2.5% of the payment amount, according to the law. Collection agencies must also offer individuals a payment option to individuals that does not cost them anything and agencies must disclose the no-cost option “at the same time and in the same manner” as the individual’s credit card information is taken.

The law also slightly amends the definition of a collection agency, to “a person that, in the ordinary course of business, engages in debt collection,” from “a person or entity who, in the ordinary course of business, engages in debt collection.”

In order to allow the convenience fee to be charged, the law amends the North Dakota Century Code and adds a new section to chapter 13-05 of that code.

The bill passed by a vote of 92-2 in the state House and 83-2 in the state Senate.

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