You’re a start-up business and brainstorming ways to best save money and get your business off the ground. The past few statement fees have indicated a plummet in profits, mostly due to having to pay credit card processing fees. You’ve hit a wall and can’t determine a better solution to accommodate your needs. Have you considered a merchant processing solution that offsets the fees associated with your customer’s credit payments? That’s the beauty to a cash discount program.
What is a cash discount program? Essentially, a cash discount program pays a merchant’s credit card processing fees by adding a 4% customer service charge to the original price each time a customer opts to use a credit card. So where does the “discount” come into play? When a customer decides to use cash, they immediately receive a 4% discount. For example, an individual purchases a water bottle and decides to pay with a Credit Card. The original price is $10, but ends up becoming $10.40 with the customer service charge. Whereas if the individual opted to pay with cash, they would of been held to the original price of $10, not having to pay the customer service fee, therefore granting them a “discount”.
With this program comes its advantages and disadvantages. In terms of its benefits, the merchant saves money by having 0 processing fees and retaining more profit/revenue because of this. This however is on the merchant side, most customers don’t notice the “service fee” or are probably now used to seeing this fee depending on the different places that they frequent. There are the few that do see it and question it. As most merchants can understand that seeing a fee may concern customers they can easily explain that by paying with cash they can then “discount” the fee. All the signage that is mandatory for merchants with the cash discount program also includes a phone number that the customers can call if they have any further questions.
Another added benefit is that the cash discount program has no long term contracts, no statement fees, no early termination fees, allows for next day funding, and all that is needed for approval is a disclosure signage as mentioned before. While the positives outweigh the negatives, this beneficial program is limited to a select few products. The most common POS with the Cash Discount Program is the Pax S-80. The Pax S-80 comes pre-coded to operate with a cash discount program which allows for a seamless transition. Along with the Pax S-80, the cash discount program is compatible with the Clover Mini, Clover Flex, and Clover Go. All that is required is to purchase an app.
When it comes to deciding if your business fits the cash discount program, it simply depends on your business. Do you process a lot of credit and debit cards? Are you a seasonal business? Once you answer a couple of questions of your processing with us we can then set you up with Cash Discount. Don’t wait, call FlashBanc today!