Now more than ever, businesses of all sizes are looking for opportunities to reduce costs and save money. Switching from a traditional card payments acceptance program to Cash Discount can help.
Business owners that accept credit cards know the fees associated with card payments can be a significant expense. While merchants might balk at paying card processing fees, they also want to offer customers convenient payment options to encourage sales. Accepting a wide variety of payment methods (credit cards, debit cards, gift cards, mobile payments, cash, etc.) is the best way to serve a wide array of consumer preferences.
Cash Discount payment programs are emerging as an alternative to traditional card acceptance. By offering a discount for cash payments, businesses can encourage low-cost cash payments and offset the fees associated with card payments. Here’s a quick overview of how Cash Discount works.
What is Cash Discount?
Cash Discount is an alternative to traditional credit card payment processing. It incentivizes customers to pay using cash but doesn’t penalize customers paying with cards.
How does Cash Discount work?
Cash Discount reduces the price of a product when customers pay with cash instead of cards. The payment terminal automatically assesses a fixed percentage fee while discounting that fee to customers using cash. The fee is equal to the cost of processing each transaction and therefore passes the cost of card acceptance to customers instead of merchants.
Is Cash Discount a surcharge or convenience fee program?
No. While Cash Discount can be confused with surcharge or convenience fees programs, it is a distinct approach. The merchant applies the fee to all sales, not just card payments. A discount equal to the service fee is then offered at checkout to customers that pay with cash.
How is Cash Discount communicated to customers?
Prominent signage on doors, windows, and at the point of sale communicates the use of Cash Discount at businesses. Payment processors will supply this signage to merchants.
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