Credit card users in some states may have noticed a new fee on transactions when they swipe their cards thanks to new “checkout” surcharge fees.

According to CNN Money, the new 4% “checkout” fee rolled out on Sunday in 40 states in the U.S. after a $7.25 billion settlement between credit card issuers and merchants.

The settlement, announced back in July, happened when Visa, MasterCard and nine other major banks settled to fix credit card processing fees with merchants. Part of the agreement noted that credit card issuers would reduce the fees paid by merchants when credit cards are used, but only until eight months after the settlement was reached.

Now, that window of time has come and gone, and as a result, merchants and retailers now have the option to charge customers who use credit cards. Beginning on Sunday, some merchants began charging between 1.5 percent and 4 percent of the total purchase price on all transactions to cover processing costs to credit card companies.

“This allows merchants, if they choose to, to impose their own surcharge — an additional surcharge the merchants asked for and will be allowed to charge — as part of this $7 billion settlement,” South Dakota Bankers Association President Dave Everson said.

However, in the settlement, merchants and retailers have the option to charge or not to charge the tax on its customers.  Some retailers and merchants have lambasted the agreement, saying it puts the “wrongdoings of credit card issuers” on the consumer, according to CNN. Some retailers, like Walmart, Macy’s, JCPenney, the Limited Brands and more, joined a petition with the National Retail Federation, claiming the new tax threatens merchants’ priority to keep prices low for customers. Still, retailers have the dilemma in choosing whether to take the burden upon themselves or charge customers the new tax.

For concerned consumers, it should be noted that the new surcharge fee does not apply to purchases made using debit cards.

Also, it is illegal to charge the fee in 10 states: California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma and Texas. The remaining 40 states will charge the new “checkout” fee.

National retailers including Walmart, Target and McDonald’s vowed not to pass on the tax to customers in any states.

Below is a list of states that will charge the new “checkout” fee for credit card transactions.

1.       Alabama

2.       Alaska

3.       Arizona

4.       Arkansas

5.       Delaware

6.       Georgia

7.       Hawaii

8.       Idaho

9.       Illinois

10.   Indiana

11.   Iowa

12.   Kentucky

13.   Louisiana

14.   Maryland

15.   Michigan

16.   Minnesota

17.   Mississippi

18.   Missouri

19.   Montana

20.   Nebraska

21.   Nevada

22.   New Hampshire

23.   New Jersey

24.   New Mexico

25.   North Carolina

26.   North Dakota

27.   Ohio

28.   Oregon

29.   Pennsylvania

30.   Rhode Island

31.   South Carolina

32.   South Dakota

33.   Tennessee

34.   Utah

35.   Vermont

36.   Virginia

37.   Washington

38.   West Virginia

39.   Wisconsin

40.   Wyoming

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