What is a Movie Theater “Convenience Fee?” Do I Have to Pay it?

You have heard a lot about sneaky fees that different service providers tack onto their regular service fees to make an extra buck.

However, unless you have crawled through your receipts and itemized every dollar you have spent you may have never actually seen one of these fees in action.

(With all the following information, please keep in mind that we are not lawyers, and this does not constitute legal advice. This article is for informational purposes only).

What Is a Convenience Fee? 

“Convenience fees” are also called “surcharges” and are an additional amount of money added to the final transaction. This cost is associated with online ticket buying for movie or concert tickets. It can be charged to cover processing costs, host fees, and any other charges the seller may incur while selling products online. 

There are other kinds of surcharges, but convenience fees are among the most common. These are usually incurred when purchasing movie tickets or concert tickets through an online retailer like Fandango. When determining if a charge is a “convenience” charge, you can look at a few notable features of the charge. 

The fee should be an amount charged on all transactions made through the channel and would not be applied if purchased at a brick-and-mortar point of sale. So, if your tickets are $3 more expensive online, you might be getting hit with a convenience fee for purchasing the tickets online. 

Payment type will not be a “trigger” for convenience fees. For example, if you must pay more to use certain cards, this is not a convenience fee since it is not related to the retailer, but the payment type. 

The fee is flat versus a malleable amount ($2 vs 2%) and is charged based on quantity over the total transaction amount. So, if you get a fee for each ticket you purchase through an online store, you might be being charged a convenience fee. 

These fees are perfectly legal and do not present any challenges that users could take to court that we, as uneducated non-lawyers, can see. They are specifically designed to fall within the boundaries of the law so that they cannot be challenged. 

There is no way to get these fees waived. Usually, they are handled by the merchant and are related to the channel of purchase. So, getting them waived is entirely a decision by the person who wants your money and there is no legal precedent for getting them waived.

You do not have a right to convenience. It is just something that a company can offer to make your life easier and the charge of running such a service will be passed to the consumer one way or another. 

Other Surcharge Fees 

Convenience fees are not the only kinds of surcharges you might encounter when shopping online. Surcharges are applied to offset the processing fee covering a purchase using a credit card or other “convenient” payment method. 

In the sales sector, these can be helpful to offset the processing fees on large purchases where the margin of profit is small, like tattoos, game consoles, and other big-ticket electronics. However, the waters are much more legally murky when it comes to surcharges as there is legal oversight to what situations can warrant a surcharge and how much it can be applied for. 

Here is the characteristics of a processing surcharge so you can keep your eyes peeled for them. 

The amount is charged regardless of the payment channel. The fee will be applied whether the transaction is made in person or online. They do not distinguish between payment channels as much as they distinguish between payment types. 

Since they are distinguishing between payment times—they are trying to offset credit card processing fees—payments made using cash, checks, or eChecks will not be charged with the surcharge. This is purely a charge to help the company offset the credit and debit card processing fees when processing digital transactions. 

Are Surcharges Legal? 

Surcharges are not necessarily legal. So, it is worth checking your state and local laws to see if there is something you can fight back with. Currently, ten states prohibit the introduction of credit card surcharges: California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma, and Texas. 

In these states, it is illegal to introduce a charge to offset the cost of processing credit card payments onto the consumer. If you live in one of these states, you can check with a local law body to see if the surcharges you have been receiving fall into those categories and should be removed. 

Making the situation more complicated is the charging of surcharges online to help offset credit card processing fees. When charging surcharges online, it is a legal grey area as to whether the merchant can charge a surcharge that would be legal in their operating state to a consumer in a state where it would be illegal.  

Most legal bodies suggest that you not charge credit card processing surcharges when operating across state lines because there is a good chance that if you were taken to court you would lose; the law tends to side with consumers when put under the pressure of trial. 

Surcharges are also subject to the guidelines outlines by the different card brands. Visa and MasterCard have their own rules for what surcharges can be introduced, as do American Express and Discover.

However, the most important and universal rules are as follows. 

For starters, the merchant must let the card brand know at least 30 days prior to introducing a surcharge. This allows the card brand to vet the situation on their end and ensure that the merchant is following all the rules that they have set forth. 

The amount of the surcharge must be clearly displayed to the cardholders at the point of sale and displayed clearly on the receipt. This allows cardholders to make informed decisions about which merchants they patronize. It also enables the cardholder to know in advance what to expect from a merchant and verify the surcharge on their receipt. 

Naturally, surcharging must be legal according to state law. If surcharges are not legal according to state laws, they are prohibited by the card brands. 

Finally, the surcharge cannot exceed the costs you currently pay for processing. The surcharge is meant to allow merchants to recoup the cost of processing fees. It is not meant to be a method for the merchant to make more money from the consumer. So, the surcharge is capped at the amount of the processing fee to prevent predatory surcharge levels. 

Cash Discount Loophole 

One loophole that is allowed by law, even if other options are prohibited in a state, is a cash discount. This allows the merchant to have the same net impact in charging credit card customers but approaches the problem from a different angle.  

To create a cash discount, you must intentionally overcharge your patrons who pay with card. So, if you have a product you want to sell for $100, you advertise the price as $103 and offer a 3% discount for those paying with cash or check. 

In doing so, you have offset the credit card processing fees and managed to make your cash and check customers feel like they are in on a secret club where they get special prices for being “local.” It is an excellent way to make your customers feel important while maximizing profits for your company. 

Can Surcharges Be Waived? 

The waiving of surcharges is entirely the prerogative of the merchant. While some merchants may charge illegal or unethical surcharges, your best bet will be to patronize another establishment. You could certainly drag them through the mud and take them to the legal cleaners, but in many cases, it is squeezing blood from a stone since the owners do not have money to pay out and make it worth the time and effort you have put into litigating them. 

If you do not have other options, talk to the merchant, and explain your situation. Many mom-and-pop stores will waive charges to foster good relationships with their consumers.  

Avoiding Movie Theater Convenience Fees

Every theater chain is different, but there are some ways to avoid (or minimize) the convenience fees you pay.

First, if your theater of choice has a membership program, check if membership allows you to avoid convenience fees. For example, AMC charges a convenience fee for online/app ticket purchases, but AMC Stubs A-List members never have to pay this fee.

Next, see if the fee only gets charged when purchasing online. Using the above AMC example, you can avoid the convenience fee by purchasing tickets in-person rather than using the website or mobile app. Of course, there will be downsides to approaching the problem this way, but it is certainly a way to save a few dollars.

Finally, be careful using third-party marketplaces that charge additional fees. Fandango is probably the most widely known of these companies. There are many reasons to use these services, and some of them are great when it comes to advance booking and convenient ticket purchasing. But if you can save a few dollars by purchasing directly from your local theater, rather than a third-party site like Fandango, it may be worth considering. And if you are committed to using Fandango or a similar service, do a quick search for coupon codes (which sometimes waive the fees) or joining a VIP program before you get hit with convenience fees at checkout.

And one final, tried-and-true way to save on movie tickets — consider the matinee. We have a detailed guide on saving money with matinee tickets, but the punchline is this: going on discount days, or anytime outside of primetime, can save you significantly on your movie tickets.

Final Thoughts 

It can be frustrating when you find a purchase to be more unwieldy than you bargained for. Credit card surcharges are common with most states in the United State passing the cost off on the buyer when it should really be the merchant’s responsibility to pay to accept certain payment methods.

While some states have adopted more consumer-friendly laws, they run into the issue of establishments becoming “cash only” to avoid high credit card processing fees.