Frequently Asked Questions
Q: How does Cash Discounting work?
A: This program is a way for merchants to offset most of the cost of their processing fees. Merchants
implement a service fee that applies to all products and then gives a discount to customers who
choose to pay with cash. Customers who pay with cash will avoid the additional fees and all others
will see a line item added to their receipt. To start using Cash Discount, merchants must post signage
alerting customers about the fee applied to all items, and also update their terminal application to
add the appropriate fee to transactions. Integrity’s program makes this easy!
Q: Is this program legal?
A: Yes, cash discounting is legal in all 50 states. The Dodd-Frank act prohibits payment card networks
“from inhibiting the ability of anyone to provide a discount for payment by cash, checks, debit cards,
or credit cards.”*
Q: I’ve never heard of this practice before, is it new?
A: No, businesses have been offering discounts for those who pay with cash for years. In the United
States, a lower posted price for cash is very common at gas and service stations across the country.
Q: Is this like a surcharge?
A: No, offering a discount to customers who choose to pay with cash is a completely different
situation than surcharging when it comes to the card brands’ regulations. While surcharging is
allowed under certain parameters laid out by the card associations, business owners are able to price
their products and offer discounts on those products at will. Cash discounting is the business owner
exercising that freedom. Surcharging is adding a charge only for customers who use a credit card, and
is not currently allowed in ten states.
Q: Will this program completely eliminate my monthly processing bill?
A: Almost. Some merchants will still see some small fees on their bills due to the variations in
Interchange prices, but most will see a drastic (95-100%) reduction in their processing bill. Fundblock Capital will
set up your bill on a daily discount structure, meaning we will take your fees out every day instead of
a lump sum at the end of the month. Your monthly statement will show a near-zero cost of processing
with the money for the goods and services you sold showing up in your deposit. You will also have a
small monthly subscription fee to cover your participation in the program.
Q: How do I decide between a flat, per-transaction fee and a percentage?
A: Fundblock Capital will set that up for you based on your average ticket size. For those businesses with
an average ticket below $15, we recommend a flat dollar amount, per transaction fee. For those
with a larger than $15 average ticket, 3.99% works best. This process ensures that as much of your
processing costs as possible are covered.
Q: Will my customers be upset with this fee and go elsewhere? Won’t I lose business?
A: Not according to other business owners’ experiences. As cash use declines, the hassle of going to
an ATM and paying those fees (sometimes north of 5%) is not worth paying a little extra to use a card.
4% (or a small flat fee) on an individual transaction has a small impact to the consumer, but a very
significant impact on your cost of doing business. If you explain the cash discount program is a way
for you to keep providing quality goods and services without increasing all of your prices, consumers
have shown they are willing to keep shopping with you.