The bill amends Title 6 of the General Laws by adding a new chapter, CHAPTER 26.2, which addresses interchange fees related to electronic payment transactions. It defines key terms such as "acquirer bank," "authorization," "interchange fee," "merchant," and others. The bill specifically prohibits issuers, payment card networks, acquirer banks, or processors from charging merchants interchange fees on the tax or gratuity amounts of electronic payment transactions, provided that the merchant informs the acquirer bank of these amounts during the authorization or settlement process. If a merchant fails to transmit this data, they may submit tax and gratuity documentation within 180 days to receive a credit for the fees charged on the tax or gratuity amount.

Additionally, the bill establishes penalties for violations, imposing a civil penalty of $1,000 per electronic payment transaction for entities that do not comply with the provisions. It also prohibits the manipulation of interchange fees by increasing the rate or amount of fees applicable to the portion of a transaction not attributable to taxes or gratuities to circumvent the prohibition. The act is set to take effect on January 1, 2026.