Learn how to save money offering cash discounts

Mar 4, 2021
Written by wpengine

Article courtesy of our partners at SpotOn

Where many companies blur the line between cash discount and surcharge, at SpotOn, we always work closely with you to differentiate between options and help you set up a program that doesn’t hurt your business or your customer base. The result in both surcharge and cash discount programs is the same—your business recoups some, if not all, of your processing fees from the cardholders. The big difference is how the program is presented to your customers.

Are there downsides to a cash discount program? It depends. If you have a low average ticket size (less than $10), you won’t be able to recoup as much card processing fees, so it might not make sense for you. Similarly, if your average ticket is large (more than $100), you may run the risk of having card-paying customers complaining about having to pay the full price. Depending on your customer base, customers could be more or less likely to carry cash and thus be incentivized by the discount. Studies show that paying with cards leads to higher spending, which is something to consider based on your average ticket size. However, with SpotOn’s effective marketing tools you can raise awareness around your cash discount program to win over customers. Everybody loves a discount!

Think about it this way: with a cash discount, you reward consumers who pay with cash, whereas with surcharge, you penalize the consumers who pay with a credit card. The result for both programs is the same, but the program setup and consumer perception is wildly different. Many companies spin a surcharge program as a cash discount with a little bit of a twist and carefully worded marketing language, so it’s easy to get confused. Always remember that a true cash discount program, compliant with state and card brand regulations, encourages businesses to reward cash-paying consumers. That’s what you always get with SpotOn.


Is it legal?

Short answer: yes! We’ll provide you with a point-of-sale device that automatically discounts cash transactions and necessary signage to display in-store. At the onset of your cash discount program, you’ll raise prices by 4% (or your decided rate).

What will customers think?

Compared to a surcharge, which can make both customers and credit card companies feel penalized, cash discounts are a way to keep your prices sustainable and your customers feeling like they scored a deal.

Are other businesses doing this?

Yes! SpotOn has thousands of clients using our cash discount program across the nation.

Washington Retail recognizes retailers’ need to build strategies to improve online presence and reputations. SpotOn is our partner and we encourage you to seek more information by contacting Patrick Wiltsey, Director of Business Development, at 303-835-3217 or [email protected].

Is a cash discount program right for your business? Get your free demo today to see how SpotOn Assist works and learn how much money it can save you. Our program is a true cash discount that’s compliant in all 50 states, with no games or hidden fees, so your customers will stay happy and keep coming back to your business!

Get Your SpotOn Assist Demo