Is Cash Discount Legal?

Cash Discount- iPos POS
Image of a Wallet representing if Cash discount is legal

What is Cash Discount, is it legal?

After the pandemic started many merchants switched to passing the credit card processing fees to the cardholder due to the great variations in merchandise cost, and the reduction in profit margins. Many had asked if Cash Discount is Legal, let’s first start with what is cash discount.

Cash Discount is a deduction from the amount of a bill offered by the seller to the buyer for prompt payment and thereby avoiding credit card fees. Note that, Cash discounts are typically stated as a percentage of the bill. Which are legal as long as they are clearly stated to the buyer at the time of purchase.

How to offer a Cash Discount on your Business

Cash discounts or Non-Cash Adjustment programs are becoming a popular way for businesses to avoid paying credit card processing fees. Offer a discount to customers who pay with cash and recoup some of the fees you would otherwise have to pay to accept credit cards. These are typically offered to businesses that have high transaction volumes, such as restaurants and retailers. However, any business that accepts credit cards can participate in this program


How does it Work?

This program offers the ability to the restaurant the option to accept Dual Prices. Dual Prices are great for customers that want to save money every time they pay in cash. When the customers pay with credit cards there will be a surcharge(3.89%) for that order. This money will be of great overall saving for the restaurant and customers as it will otherwise be passed to menu price with no option for the customers to save and making prices less competitive for your business

Keep this in Mind

First, you will need to make sure that your point-of-sale system is capable of handling non-cash adjustments. Second, you will need to develop a clear policy to state the Cash Discount option.

Which Point of Sale can I use with the Non-Cash Adjustment Program?

There is a great variety of POS software that nowadays accepts this program. However, you can ask yourself first which other features I need or will need in the future on my Point of Sale solution. You can follow examples on our Restaurant Features Page

These discount programs can be a great way for businesses to save money on credit card processing fees. You can download your own sticker on the form below

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