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Surcharge vs Cash Discount

Surcharge vs Cash Discounts & Who Should Use Them

July 19th, 2019

Over the last year, the Surcharge and Cash Discount Programs have become more popular. Many merchants and agents still have some questions about how these two programs work and how they are different. Here are some clear differences to help you understand the two programs.

A Cash Discount Program is when a merchant displays credit card prices and offers a discount on those prices when the consumer pays using cash. A Surcharge Program is when you post cash prices and charge additional fees on top of the cost for customers who pay with a credit card. As of 2018, Surcharging Programs are prohibited by law in the following states Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, and Oklahoma. Merchants are considered to be breaking the law if they surcharge in any of these states as appose to the Cash Discount Program that is allowed in all 50 states.

Which Program is better for what merchant?

This all depends, as a dry cleaner or car wash will have more success implementing the Cash Discount Program or Surcharge over a retailer. Retailers that compete with the big box stores like Amazon or Home depot will have trouble charging customers a fee for using their credit cards. We’ve seen more success with restaurants, salons, and the service industry.

If you have questions about becoming an agent or the following programs feel free to contact us at info@btrpay.com or call 877-423-8637.


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