How to Implement a Merchant Services Cash Discount Program
Are you interested in implementing a merchant services cash discount program but unsure of where to start? Fortunately, this blog is the perfect resource for you! We’ll explain everything you need to know about cash discount programs, from how they work to the ways your business can implement them. By the end of our blog, you’ll feel more confident in your knowledge of cash discount programs and be ready to start saving your business money!
How Does a Cash Discount Program Work?
At first, a cash discount may seem like a surcharge; however, they’re different in various ways. The main difference is that surcharges are illegal in most states, while cash discounts are legal throughout the United States. Essentially, a cash discount program incentivizes customers to pay with cash to avoid additional credit card processing fees, whereas surcharges do not offer an incentive (hence why it’s illegal).
Cash discounts are pretty straightforward, but it all starts with the correct posted pricing. Imagine this scenario for a moment: your customer is shopping for goods in your store, and they’re ready to enter the checkout lane. They should see a sign displayed offering the customer the cash discount. Accurate signage is crucial because your business needs to abide by national regulations and ensure that your customers know about the deal.
Once the customer pays with cash, our POS software automatically adds the discount and removes the credit card processing fee. See, it’s simple right? There’s nothing too complicated about a merchant services cash discount program.
Implement a Merchant Services Cash Discount
Now that you understand what a cash discount program is and how it works, some steps are still to follow before implementing it. Keep in mind, with the right technology partner, setting up is extremely easy for you and your employees. So, here’s how it all works:
- First, you find the right merchant services provider for your merchant services cash discount program.
- After determining the best provider, you then need to evaluate your inventory.
- Next, start the process of promoting the cash discount. Remember: the correct signage must be in place.
- Lastly, start saving money on all your credit card processing fees.
Finding the Right Provider
We briefly mentioned in the section prior that before implementing your merchant services cash discount program, you must find the right merchant services provider. Therefore, it’s crucial that you explore your options: you need to be sure that you find someone with experience setting up cash discount programs. Otherwise, you’ll experience unnecessary difficulties further down the road.
So, when you’re searching for a provider, here are a few things you should consider before reaching a final decision:
- Competitive or low rates: Since customers are bound to use their credit cards, you want to ensure that you’re passing on a lower rate to them, even if you’re not paying for any credit card processing fees.
- Next-day funding options: No one should wait forever trying to access their funds. Verify that your provider can get you your money as soon as possible.
- POS technology features: In addition to cash discounts, you’ll need POS features to guarantee that your program runs smoothly and works efficiently. Any technology that your provider can help you with is always a bonus.
Cash Discount Program Promotion
As previously stated above, you must ensure that proper signage is near your register and clear to read. You might be wondering: what’s all the fuss about accurate postage and promoting cash discounts? See, under the Durbin Amendment of the 2010 Dodd-Frank Act, businesses are permitted to offer cash discounts so long as customers are made aware of the program.
So, in addition to having signs around your store, you should also verbally offer customers a cash discount during the transaction. Proper promotion helps shoppers stay aware of cash discounts while keeping you and your business safe from government intervention.
Start Saving Money Today
When you set a merchant services cash discount program into motion, you’ll start eliminating credit card processing fees and saving more money. Plus, some businesses can save upwards of $10,000 a year, depending on their total credit card transactions. Imagine all the things you could do for your business when you have extra cash in your pocket!
Find out how much money you’ll save with our Cash Discount Program today with a free complimentary analysis by one of our payment specialists. So, stop waiting around and use your newfound knowledge to get started on your merchant services cash discount program!