WHAT IS A CASH DISCOUNT

Advanced software is currently available that automatically offers your consumers the option to receive a discount if they make a purchase with cash. Like a surcharge, a business is required to notify all customers of a service or convenience fee added to all transactions prior to purchase. The difference between a surcharge and cash discount is that with a cash discount, the fee can be removed with the consumer paying with cash.

Businesses are permitted to offer a discount to customers as an incentive and to encourage customers to pay by alternative methods such as checks or cash to receive a discount on their purchase. The cash discount works by applying a small customer service fee on all customer transactions. This fee is removed if the customer pays with cash or in-store gift card. Legal cash discount programs must present a clear receipt detailing the service fee or cash discount amount.

The consumer sees your prices upfront and the convenience or service fee is openly disclosed for transparency. Offering a discount for a cash payment gives your customer the option to save money and your business keeps card processing expenses at an all-time low. 

It’s important to note that every business is different, and a surcharge or cash discount may not be a sensible option. No matter how you look at it, the world is going through unprecedented times and we all need to be informed to make the best decisions.

If you’re interested in learning more about payment solutions, we’re here to help you determine what’s best for your business.

Referenced articles:

https://www.cnn.com/2020/09/19/us/nyc-covid-restaurant-surcharge-trnd/index.html#:~:text=on%20Covid%2D19-,NYC%20restaurants%20can%20soon%20add%20a,19%20surcharge%20to%20customers'%20bills&text=An%20outdoor%20restaurant%20in%20New%20York%20City%20in%20September%202020.&text=%22If%20you%20go%20to%20a,they%20want%2C%22%20Borelli%20said.