Cash Discount

Billfold with cash and credit cards

Cash Discount Program


The program is referred to in the industry as the Cash Discount Program.  Free credit card payment processing is savings merchants of all sizes and types.  People expect businesses to add a mark-up to goods in their store.  Businesses do their best to keep their retail prices as low as possible, and still profit from their hard work.  Otherwise, they risk not being competitive. One of the costs of doing business is accepting payments whether it be cash, check, or credit. Cash must be manually counted and taken to the bank, and you also have a greater risk of employee theft with cash payments.  Check payments are a risk if the payment fails to clear the bank.

However, while more and more people use bankcards of some type to make a payment, and carry little to no cash, the cost of your business accepting payments increases constantly. As card issuing banks, card brands (Visa, MasterCard, Discover & American Express), and check processors add fees and raise rates, the cost of doing business continues to rise.  Normally, a business would mark up only the products that have increased.  This increase affects the business across its entire margin. There is a way to offset the overall cost of various forms of payments.

Offsetting Cost

By simply adding a 3% – 4% service charge on all sales at the point of sale, it can offset some, most or all of the credit card fees – depending on the percentage you wish to charge.  Your business can now accept credit card payments for free.  Certain business types will see a greater benefit by adding a flat rate service charge instead of a percentage.  Our experts have the experience and knowledge to help you navigate the most advantageous service charge for your unique situation.

The customer’s receipt will show the service charge added, and the daily batch totals report will also provide clear totals separating the sales from service charges.  A correctly priced service charge will result in the merchant processing statement to show little or no fees due from your business for accepting credit cards.

Nuts and Bolts

Although any face-to-face merchant can benefit, the Cash Discount programs are often more favorable for small ticket retail or restaurants.  A typical $5 transaction paid with a debit card will traditionally cost a business $.23 before any processor or card fees are added. This results in 4% lost profit due to the cost of accepting a payment.  After the processor, provider, and the card brands add their cost, the lost profit can be closer to 5% or more.  A customer will have the option to discount their $5.00 purchase for paying with cash, or pay the service charge to offset the fees to accept a card payment.  If your business accepts payments onsite, you could still benefit from free mobile credit card processing.  If you would like to know how to accept credit cards for free, or would like to start a Cash Discount program now, please contact us.