If your business is looking to offer cash discounts to customers paying with cash or surcharge programs to those paying with cards, there are several requirements you must adhere to. The card brands have set specific guidelines for how cash discount and surcharge programs must be implemented, and one of the critical mandates is signage. This blog will outline the requirements for cash discount signage and credit card surcharge signs set by Visa, Mastercard, American Express, and Discover.
What are the Rules?
It’s important to note that cash discount and surcharge programs are unique to the United States and that different states have varying regulations. If your business is looking to offer either of these programs, you must first make sure you’re compliant with state and local laws. The only states you may not impose surcharging fees in are: Connecticut, Massachusetts, and Puerto Rico. There are also states that set limits on surcharging: Colorado, Maine, and Oklahoma. Additionally, each card brand has requirements for cash discount signage and credit card surcharge signs–
With a cash discount program, you must display signage at the entrance of your business that is visible to customers before they enter. The sign, accesible on Visa’s website, must state the cash discount percentage and the conditions under which the cash discount will be applied (e.g., “All sales are final”). Also, Visa recently adjusted policies to allow merchants to offer a “service fee” discount for cash-paying customers or a “convenience fee” for card users.
If you plan on implementing a cash discount program, you must display signage at the entrance of your business that is visible to customers before they enter. The sign must state the cash discount percentage and the conditions under which the cash discount will be applied (e.g., “All sales are final”). For AmEx’s credit card surcharge signage, the brand does not require the amount of the surcharge on the receipt.
If you plan on implementing a cash discount program, you must display credit card surcharge and cash discount signage at the point-of-entrance and point-of-sale that is visible and clear to customers. The sign must state the cash discount percentage and the conditions under which the cash discount will be applied.
As you can see, the card brands have very similar requirements regarding surcharge and cash discount signage. You must adhere to these requirements to avoid penalties or fines from the card brands.
Online: Credit Card Surcharge Signs
Surcharge fees can also be used for eCommerce payments, and the card brands have different requirements for online credit card surcharge signage. Just like in-person, Visa requires businesses to transparently state the ‘merchant fee’ or ‘processing fee’ as an additional expense. This fee must be clear to the customer before they complete the purchase. For Mastercard, no specific language needs to be used to communicate the surcharge fee online. Discover doesn’t have any particular language requirements but states that the purchase amount should be displayed before the customer enters their payment information. Just because the information is online doesn’t mean it can be hidden– surcharge fees must be made clear to the customer before they finalize their purchase.
If you have any questions or need help getting started with cash discount or surcharge programs, reach out to us at Seamless Chex. Seamless Chex is the premier credit card processing solution for businesses of all sizes. We offer a simple, easy-to-use solution that helps businesses save money on processing fees, increase customer satisfaction, and grow their business. Contact us today to learn more! We’re always happy to help!