How To Implement A Cash Discount Program

Cash discount programs have recently gained popularity among business owners who want  to eliminate their payment processing costs while still offering the convenience in accepting credit cards. But a cash discount program doesn’t eliminate payment processing costs altogether. Rather, a cash discount program simply allows a business owner to pass on credit card processing fees to customers. 

The rest of this article explains how a cash discount program works & how you can implement one for your business.

What Is A Cash Discount Program & How Does It Work?

As explained, a cash discount program allows you to pass on the cost of a transaction to the customer. But how does this work?

It’s actually pretty simple, but a lot of people tend to overcomplicate it. And it all starts with your posted pricing. 

  1. Price Adjustment – The business adjusts its posted pricing to include an additional fee that will cover the processing cost of a transaction. Most bundled processing rates are between 2-4%. Therefore, if a merchant’s bundled rate is 3% then a $10 item will then have an adjusted price of $10.30. 
  2. Program Promotion – You the merchant offer a cash discount of 3% (in this example) to customers who pay with cash or check instead of a credit card. According to the Durbin Amendment, the discount needs to be both visually & verbally demonstrated to customers. For this reason, cash discount signage is required to maintain legality. 
  3. Discount Application – Your point of sale device or credit card terminal automatically applies the discount to cash transactions. Therefore, if the customer purchases the $10.30 item with cash, he or she will have a pre-tax total of $10. 

A cash discount seems like a surcharge program, which is actually illegal in the United States. But it actually isn’t since you are offering an incentive to your customers to pay with cash, which is legal.

And since you are posting adjusted pricing, you aren’t applying a surcharge at all: you’re simply offering a discount to customers who pay with cash (hence the cash discount). 

Cash Discount Program Implementation

Now that you know how a cash discount program works, let’s discuss how you can actually implement one for your business. With the right technology provider, the set up & implementation of the program will be extremely easy for you & your employees. 

Here’s how it all works:

  1. Find a merchant services provider that offers a cash discount program
  2. Adjust your inventory
  3. Promote the cash discount program
  4. Save money on credit card processing

Finding The Right Merchant Services Provider

Cash discount programs operate at the merchant account level, meaning you’ll need to open a merchant account with a service provider who has developed cash discount technology. Three things you’ll want to look for in a merchant services provider are competitive rates, next-day funding & other technology features.

  • Competitive Rates – Although you yourself will not be paying any credit card processing fees, you’ll still want to secure a low rate so that you don’t pass on too much additional cost to your customers.
  • Next-Day Funding – Quicker is always better when it comes to how long it takes you to receive your funds. That’s why you’ll want to find a processor that can get you your money next-day at the very least.
  • Technology Features – Any other features that the provider can offer you will help you run your business smoothly. Therefore, be sure to find out what other POS features the business can offer you in addition to the cash discount program. 

Adjusting Your Inventory

Most cash discount technologies will adjust your inventory automatically so that your new pricing is reflected on your point of sale system. However, you’ll also need to update your published pricing on your website, menu or wherever else you post the prices of your products & services.

Promoting Your Cash Discount Program

In order to maintain compliance with the Durbin Amendment, you’ll need to promote your cash discount both visually & verbally. That means having cash discount signage near your register & perhaps even some near the entrance of your business. You’ll also need to verbally promote the program during the transaction so that your customers understand the available incentive.

Saving Money On Credit Card Processing

With your cash discount program all set up, you’ll eliminate one of the costs of doing business in the modern age. Some businesses can save up to $10,000 a year depending on credit card volume. Nevertheless, once the program is enabled with your payment technology, then your work is done. Process everyday transactions as you always do & save!

For more information on our payment services, visit our website. For more articles like this one, visit our blog

Share This Article!

Share on facebook
Share on linkedin
Share on twitter
Share on email

Our Partner Network

  • 123local
  • 2findlocal
  • 8coupons
  • ABLocal
  • AllergyEats
  • AllMenus
  • AmericanTowns
  • AroundMe
  • Baidu
  • Banks.com
  • Brownbook.net
  • Central Index
  • ChamberofCommerce.com
  • CitySquares
  • CK Maps
  • Cylex
  • DexKnows
  • DoorDash
  • Dun & Bradstreet
  • eLocal
  • EZlocal
  • Find Open
  • Fliggy
  • GoLocal247
  • HERE
  • HolidayCheck
  • HostMe
  • HotFrog
  • iBegin
  • iGlobal
  • Insider Pages
  • Instagram
  • Local.com
  • LocalDatabase
  • LocalPages
  • LocalStack
  • Mafengwo
  • Mapstr
  • Menupix
  • MerchantCircle
  • My Local Services
  • n49
  • Navmii
  • NDrive
  • Opendi
  • OpenTable
  • Parent Day Out
  • Pitney Bowes
  • Pointcom
  • Postmates
  • Property Capsule
  • RetirementPlanning.net
  • SafeGraph
  • ShowMeLocal
  • Soleo
  • Superpages
  • tellows
  • TomTom
  • Top Rated Local
  • Trip.com
  • TripAdvisor
  • TrustPilot
  • Tupalo
  • Uber
  • Uber Eats
  • USCity.net
  • VotefortheBest
  • Waze
  • Where To?
  • WiserAdvisor
  • Yalwa
  • Yandex
  • YaSabe
  • YellowMoxie
  • YellowPageCity
  • YellowPagesDirectory
small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

Read A Client Success Story

Learn How To Leverage The Power of Facebook for Growth!

Read A Client Success Story!

Learn How To Leverage The Power of Facebook Offer Ads for Growth!

Read A Client Success Story!

Learn How To Leverage The Power of Facebook Lead Ads for Growth!

Read A Client Success Story!

Learn How To Leverage The Power of Facebook Awareness Ads for Growth!

Read A Client Success Story!

Learn How To Leverage The Power of Facebook Click Ads To Grow Your Business

Read A Client Success Story!

Learn How We Increased Our Client's Online Visibility & Got Him More Leads!

Get Your Web Design eBook!

Learn What Separates A Winning Website From The Losing Ones

Get Your Free SMS Marketing eBook!

Learn How To Turn New Purchases Into Your Most Loyal Customers

Get Your Reputation Management eBook!

Learn How To Build Your Online Reputation & Get More Paying Customers

Get Your Free Ebook Today

Learn How To Audit Your Merchant Statement And Cut Your Costs

Get Your Google Ads eBook!

Learn How To Convert Web Traffic Into Revenue

Get Your Facebook Ads eBook Today!

Learn How To Advertise On The World’s Biggest Stage

Can Google's Crawlers Understand Your Site?

Find Out If Your Website Has Schema Markup

Schema Markup - Contact Info
small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

small_c_popup.png

Let's have a chat

Your Free Payments Consultation Awaits

Read A Client Success Story!

Learn How We Helped Our Client Build Their Online Reputation & Get More Customers As A Result!

small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

small_c_popup.png

Let's have a chat

Your Free Payments Consultation Awaits

Let's Create Your Free Account

Claim Your Free Clover Today!

small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

Let's have a chat

Your Free Local Marketing Consultation Awaits

small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

small_c_popup.png

Let's have a chat

Your Free Local Marketing Consultation Awaits

Read A Client Success Story!

Learn How To Leverage Google Ads For Business Growth

Read A Client Success Story!

Learn How To Leverage The Power of Text Message Marketing For Your Business!

Want To See How You Show Up?

Tell Us Where To Send Your Report!

Run Your Free Business Report - Contact Info
Pop-up form preceding Yext Scan CTA, basic contact info

Ready To Boost Your Business?

Create Your Free Account To Claim Your Package!

All In One Packages - Professional

Pick A Time To Speak With A Local Business Expert

Place Your Vision Online With Award-Winning Web Design!

Web Design - Scheduling

Set Up Your Free Account In Minutes

Make It Easier For Your Customers To Pay You!

Payments - Get Started

Set Up Your Free Account In A Matter Of Minutes

Customize Your Clover To Work The Way You Do!

Clover POS - Get Started

Pick A Time To Speak With A Local Business Expert

Get More Positive Reviews With TAPLocal Review Management!

Review Generation - Scheduling

Pick A Time To Speak With A Local Business Expert

Get A Full Tour Of Our Business Manager Dashboard!

Dashboard Demo - Scheduling

Our Packages Are Built With All Your Needs In Mind

Find Out Which Package Your Business Qualifies For!

Free Clover - Pricing

Clover POS Is The Perfect Business Companion

Find Out Which Device Is Best For Your Unique Needs!

Free Clover - Meet Clover

Pick A Time To Speak With Local Business Specialist

Claim Your Free Clover Today!

Free Clover Package - Scheduling

Create Your Free Account & Pick Your Package

Claim Your Free Clover Today!

Free Clover Package - Get Started

Want To See How You Show Up?

Tell Us About Your Business

Let's Get Started

Start Rewarding Your Customers Today!

Clover App Market - Restaurant Rewards
Pop-up form on Restaurant Rewards page

Pick A Time To Speak With A Local Business Expert

Boost Your Business With An All In One Package!

All In One Packages - Scheduling
Pop-up form preceding All In One Packages scheduling

You Could Be Saving Thousands Of Dollars A Year

See How TAPLocal Stacks Up To The Competition

Payments - Competitor Pricing
Pop-up form preceding Yext Scan CTA, basic contact info

Ready To Boost Your Business?

Create Your Free Account To Claim Your Package!

All In One Packages - Ultimate

Ready To Boost Your Business?

Create Your Free Account To Claim Your Package!

All In One Packages - Standard

Read A Client Success Story!

Learn How We Grew Our Client's Business With Stellar Web Design

Ready To Boost Your Business?

Create Your Free Account To Claim Your Package!

All In One Packages - Builder

Ready To Boost Your Business?

Create Your Free Account To Claim Your Package!

All In One Packages - Starter

Pick A Time To Speak With A Local Business Expert

Start Gaining Repeat Business From Your Customers Today!

Text Message Marketing - Scheduling

Pick A Time To Speak With A Local Business Expert

Take Control Of How You Show Up Online Today!

Listings - Scheduling

Pick A Time To Speak With A Local Business Expert

Starting Driving Hyper-Local Traffic To Your Website!

Listings - Scheduling

Pick A Time To Speak With A Local Business Expert

Boost Your Facebook Ads With Hyper-Local Technology!

Facebook & Instagram - Scheduling

Pick A Time To Speak With A Local Business Expert

Get Prime Exposure With Our Reach & Frequency Guarantee!

Facebook Awareness Ads - Scheduling

Pick A Time To Speak With A Local Business Expert

Advertise On The World's Leading Search Engine!

Facebook Awareness Ads - Scheduling

Pick A Time To Speak With A Local Business Expert

Find Out How TAPLocal Can Grow Your Business!

TAPLocal Appointment - Scheduling

Pick A Time To Speak With A Local Business Expert

Get HOT Local Leads Delivered Directly To Your Phone!

Facebook Lead Ads - Scheduling

Pick A Time To Speak With A Local Business Expert

Help Hungry Customers Find You When They Need To!

Listings For Food - Scheduling

Pick A Time To Speak With A Local Business Expert

Drive Sales With Redeemable Offers On Facebook!

Facebook Offer Ads - Scheduling

Pick A Time To Speak With A Local Business Expert

Simplify How Your Customers Pay You & Cut Processing Costs!

Payments - Scheduling

Pick A Time To Speak With A Local Business Expert

Simplify Your Day-To-Day With The Perfect Point Of Sale!

Clover POS - Scheduling

Get Your Business Listings eBook!

Learn How To Get Found By Consumers Who Are Searching For A Product Or Service That You Offer