Card processing fees add up. Three programs let you pass some or all of that cost to customers who choose to pay by card. Each works differently, and each has rules.
Surcharging
You add a fee only to credit card transactions, on top of the price.
- Card-brand rules cap the amount and require clear disclosure at the entrance, at checkout and on the receipt.
- You cannot surcharge debit cards, even when a debit card is run as credit.
- Some states restrict or prohibit surcharging, so check your state's rules first.
Cash discount
Your posted price includes the card cost, and customers who pay cash get a discount.
- The difference is presented as a discount for paying cash, not as a fee for paying by card.
- Signage must explain the discount clearly.
- Because it is not a surcharge, it is not limited to credit cards. It can apply to credit and debit.
Dual pricing
You show two prices, a card price and a slightly lower cash price, on the menu, shelf or invoice.
- Customers see both before they pay and choose how to pay.
- Both prices should appear on the receipt.
- It works on credit and debit cards.
- It is common for restaurants, auto shops, salons, retail and other service businesses.
- It is closely related to a cash discount. Both rely on a lower cash price and clear signage.
Side-by-side comparison
| | Surcharging | Cash discount | Dual pricing |
|---|---|---|---|
| How it works | Fee added to credit card sales | Posted price includes card cost; cash gets a discount | Cash price and card price shown |
| Applies to debit cards | No | Yes | Yes |
| Disclosure | Entrance, checkout and receipt | Clear signage | Both prices visible; both on receipt |
| State restrictions | Restricted or prohibited in some states | Rules still apply, so confirm for your state | Rules still apply, so confirm for your state |
Which one is right?
- Mostly credit cards and allowed in your state? Surcharging may fit.
- Sell online or invoice B2B customers? Surcharging on credit is often simpler.
- Lots of debit cards? Surcharging will not cover those. Dual pricing or a cash discount usually covers more transactions.
- In a state that restricts surcharging? Dual pricing or a cash discount may be the practical route.
- Want simplicity and wide compliance? Dual pricing or a cash discount is often easier.
Getting it right matters
All three programs have signage and receipt rules. If they are set up wrong, they can lead to customer complaints and disputes. Rules change and vary by state and card brand, so always set these programs up with your processor, never on your own.
We set up compliant programs with the right terminal settings and signage. Get your pricing in writing.
Not sure which fits? Tell us how you sell and we will explain the options at voxepay.co.