How to Implement a Cash Discount Program for Your Small Business

What’s one way to reduce your small business’s credit card processing fees while passing savings on to cash-paying customers? Implementing a cash discount program. If you’re considering this savvy business move, here’s everything you need to know about cash discount programs and how to get one up and running.

What Is a Cash Discount Program?

A cash discount program offers your customer a lower price for your goods or services when they pay with cash or pin debit (which is treated the same as cash transactions) instead of a credit card. Typically, the discount is equal to the fee you pay to process credit card transactions.

Make sure the system you’re choosing to run a cash discount program is automatically calculating the transactions for you; you don’t want to be stuck manually computing them on the device.

Cash discount programs are legal in all 50 states, but local regulations may differ from region to region. Take time to understand your region’s laws surrounding cash discount programs so you can stay compliant.

Many confuse cash discount programs with surcharges; a cash discount lowers the cost for cash-paying customers, whereas a surcharge adds a fee to card payments.

Benefits

For Businesses

A cash discount program can help businesses offset the costs of credit card fees. The more customers pay in cash, the fewer processing fees you have to pay. As fees can quickly add up, a cash discount program is especially beneficial for small businesses with tight margins.

Additionally, accepting cash payments can help avoid chargebacks, which are common with credit card payments.

For Customers

For customers, the benefit of a cash discount program is the savings they receive simply by paying with cash. Making the discount program highly visible can encourage more customers to use this method to complete their purchases.

Choosing Cash Discount Program Merchant Services

Not all merchant service providers offer a cash discount program, so it’s important to evaluate your options and choose one that supports your business’s needs.

Here’s what to look for when selecting cash discount program merchant services.

• Compliance: Because regulations vary by region, it’s important to select a provider that can help you stay compliant with all relevant laws surrounding cash discount programs in your area.
• User-friendly: You’ll want technology that can easily integrate into your existing point-of-sale system to simplify the cash discount process for you and your customers.
• Customer support: Guided support and training from your provider help you get up and running quickly so you can start taking advantage of the many benefits right away.
• Transparent pricing: From processing payment fees to setting up the program itself, the pricing structure should be very clear. Knowing exactly what a program will cost is vital, especially for smaller businesses.

Requirements to Successfully Deploy a Cash Discount Program

• Listed prices must be the card prices, or both cash and card prices
• The terminal or point of sale system must be able to display the cash discount adjustment on a receipt
• Ensure your payment system will not charge additional fees on pin-debit transactions

Additionally, it may be required to display signage that outlines your cash discount pricing. Connect with us to find out if such signage is required in your region or state.

Common Challenges

Implementing a cash discount program for your business can pose challenges, including customer confusion and issues with regulatory compliance. To overcome these challenges, partner with The Payment HQ. We offer clear communication strategies that can help your business clearly explain the cash discount program to your customers. What’s more, we prioritize compliance with state and local regulations so you can confidently implement the program without worrying about fines or legal issues.

We have several user-friendly technologies and hardware to choose from, all of which can easily integrate with your existing systems. With The Payment HQ, your transition to savings through a cash discount program is seamless and stress-free! And should there be a hiccup, our ongoing support can get you back on track.

Reduces Fees and Increase Profits With The Payment HQ

Ready to boost your profitability while keeping customers happy? We make it easy to do just that. Connect with us today to learn how our cash discount programs can transform your small business.