Surcharges And Cash Discount Reduce Merchant Cost
You may have heard of both Surcharging on Credit Card Transactions and Cash Discount Programs that help merchants save money on there merchant processing cost by passing a small cost directly to the card holder on every transaction. In many areas this is a highly sought after feature and is helping merchants save money each month on fees they are charged for taking credit cards. To help merchants better understand what option is best for them Aldelo has created a comparison.
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What is a Surcharge?
A surcharge is a fee that vendors can add onto credit card transactions to make up the cost they’re charged by the credit card association. Debit cards cannot be surcharged. Each card association has its own guidelines for applying surcharges. It is the merchant's responsibility to check with the card brands regularly to make sure they are in compliance with the rules for each card brand and that the appropriate signage is visible to card holders. You will also wan to check to see if you live in a state were surcharging is acceptable under the law. States were a Surcharge is not permitted.
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What is a Cash Discount?
A cash discount is just what it sounds like; you offer a discount to customers who pay with cash or check. The idea here is that at the time of sale, when a customer pays with cash, they receive a discount off the regular sales price. When a customer pays via a payment type other than cash at the time of sale, they do not receive any discount for the transaction. So if you live in a state where surcharging is illegal, offering a cash discount might be an alternative. Cash Discounts are permitted in every state currently. But do take a moment to plan these charges into your Item prices as you will be applying a discount to each item automatically when cash or debit is used and will be applied on top of any other discounts given at the time of purchase. (Note: in order to use Cash Discount, the merchant will need to increase prices accordingly.) |
Surcharges and cash discounts with aldelo Express
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Surcharge
If you want to use a Surcharge Program with Aldelo Express
You must register with Visa and Mastercard 30 Days before starting this program. For Visa: https://usa.visa.com/support/small-business/regulations-fees.html For MasterCard: https://www.mastercard.us/en-us/surcharge-disclosure-webform.html For Discover and Amex there is no 30 day waiting period You will need to post signs at entrances and registers alerting customer to the discount program You may want to check with your legal advisor as to any other requirements for your state |
Cash Discount
If you would like to use a Cash Discount program with Aldelo Express
There is no need to notify card brands There is no notice period needed Merchants will want to review their Item prices before implementing this program as the discount will be applied to all debit and cash sales You will need to post signs at entrances and registers alerting customer to the discount program You may need to brace yourself as you start to enjoy the cost of merchant processing being shifted to the card holders and off of the merchants shoulders |
