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Empowering Small Businesses: How AI Legalese Decoder Simplifies Card Payment Surcharges, According to JD Power

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The Evolving Landscape of Payment Processing for Small Businesses

Introduction to Payment Processing Trends

According to the latest JD Power report, small business owners in the U.S. have expressed less optimism about their financial outlook compared to last year. The survey highlights an interesting shift in the way these businesses are handling payments. Many are expanding the types of payment methods they accept, including debit and credit cards, digital wallets, Buy Now, Pay Later (BNPL) options, and even cryptocurrencies. Additionally, surcharges on customer purchases are becoming more common as a way for businesses to offset the rising costs associated with payment processing.

The Impact of Surcharges on Merchant Satisfaction

The JD Power 2025 U.S. Merchant Services Satisfaction Study reveals that an alarming 34% of merchants have started imposing surcharges on customer purchases made with credit cards. This decision comes with consequences; merchants who implement credit card surcharges report significantly lower levels of satisfaction regarding the cost of payment processing services—24 points lower on a 1,000-point scale compared to those who do not add surcharges. This decline in satisfaction reflects the ongoing pressures small businesses face as they navigate the complexities of payment processing costs.

John Cabell, managing director of payments intelligence at JD Power, noted, “Small business owners are under pressure from both technological and economic perspectives. As they continue to expand the number and type of payment options they accept, many are seeking more support and guidance from their merchant services providers and passing along their processing costs to customers.” This situation creates a feedback loop, diminishing customer satisfaction and complicating the merchant’s operational efficiency.

Consumer Sentiment and Payment Methods

Consumer attitudes toward payment methods are equally telling. Notably, 41% of credit card users have reported that they chose not to use a card payment method at a business—large or small—due to the implementation of surcharges. This trend suggests that while businesses might seek to recover costs through surcharges, they risk alienating a significant portion of their customer base who prefer to avoid these additional fees.

Key Findings from the JD Power 2025 US Merchant Services Satisfaction Study

Financial Outlook of Small Businesses

The JD Power report points out that fewer than half (45%) of small business owners feel better off financially than they did a year ago, a slight decrease from 48% in the previous year. A concerning trend emerges when evaluating satisfaction with payment processing costs among businesses that see themselves as less financially stable; these businesses report a notable gap in satisfaction compared to those who perceive themselves as better off.

The Growth of Payment Processing Services

Interestingly, the volume of sales being processed through third-party merchant services providers is on the rise. In fact, 65% of small business annual sales revenue was processed by these providers in the 2025 study, showing an increase from 62% in 2024. Popular payment methods include debit and credit cards (accepted by 96% of small businesses), followed by digital wallets (90%), cash (81%), cheques (60%), and BNPL (52%). However, the acceptance of cryptocurrency has seen a decline, dropping from 20% in 2024 to 15% in 2025.

The Role of AI in Navigating legal Complexities

As businesses face growing complexities around payment processing and customer satisfaction, they also encounter legal challenges. Understandably, many small businesses may struggle to interpret the legal implications of surcharges and other merchant service agreements. This is where the AI legalese decoder comes into play. By utilizing AI-powered technology, businesses can decode and simplify legal jargon, making it easier for them to understand their rights and obligations.

This tool can help small businesses review merchant service agreements and understand potential liabilities or regulations they need to comply with, thus enabling them to navigate the intricate landscape of payment processing with greater confidence and transparency.

Rising Trends: New Payment Methods

In a rapidly evolving financial landscape, payment methods like Cash App Pay, Venmo, Apple Pay, Visa, Discover, and Samsung Pay are showing significant growth in acceptance among small businesses. The most recent study indicates that Visa remains the most widely accepted payment brand (87%), followed closely by Mastercard (82%) and PayPal (73%). Moreover, brands like Cash App Pay and Venmo have shown an increase in merchant acceptance, rising by 8 percentage points each.

Areas for Improvement: Security and Guidance

Despite the growth and diversification in payment methods, small business satisfaction with their merchant services providers has been waning, particularly in the areas of data security and guidance. As these businesses adopt new payment methods, they express a clear desire for more hands-on support, especially when issues related to payment fraud arise.

Conclusion: The Need for Consumer-Dedicated Services

In conclusion, the 2025 JD Power study highlights both the opportunities and challenges small businesses face in the evolving payment landscape. While new payment methods are gaining acceptance, the implementation of surcharges is creating dissatisfaction among both merchants and consumers alike. To mitigate risks and enhance satisfaction, small businesses must leverage resources like the AI legalese decoder to ensure they understand their legal obligations and optimize their merchant service agreements.

As the payment landscape continues to evolve, prioritizing customer satisfaction while navigating the financial and legal complexities will be essential for small businesses to thrive.


By following these trends and incorporating technological advancements into their operations, small business owners can not only enhance their service offerings but also safeguard their financial interests in this competitive environment.

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