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Education

You are enabling them to save money • Inform consumers about the cash discount with signage at least at one
while offering discounts to their point, but multiple signs positioned at the door, at the checkout and
customers, which can help them throughout the store, are preferred.
increase profits and operate more • Include a line on the receipt that clearly shows the discount based on
competitively. payment type.

Form strategic partnerships Outlook for merchants, ISOs and VARs in a cashless world
It's important that you partner with According to the 2016 Federal Reserve Payments Study, noncash payments
a reputable cash discount program increased at an annual rate of 5.3 percent (3.4 percent in value), between 2012
provider. Do your due diligence to and 2015. And a 2016 TSYS survey of 1,000 consumers revealed 40 percent
make sure the provider complies prefer using credit cards, compared to only 11 percent who prefer cash.
with federal and state laws. Ask
for a sample receipt to make sure it As cash moves towards extinction, merchants need to find ways to subsidize
includes the requisite information their growing credit card processing fees. Merchants will turn to you as a
about the discount. business advisor to help them find a solution that will keep them profitable.
Providing cash discount programs will put you ahead of the curve, help you
It's also important to make sure that win more business and build long-lasting relationships with your clients that
partnering with the cash discount see the partnership with you as a valuable one to keep.
program provider won't limit the
types of payments your customers can
accept. Not all cash discount program Jeh Holsomback, CEO of Secure Payment Solutions Inc., has been active in the payments space for
technology works with all payment 15 years. He has helped to grow SPS from founding to 27 employees with clients in all 50 states.
equipment, so ensure your customers SPS is involved in all aspects of electronic payments, including their development and launch of
will still be able to accept, for example, Paradise POS. He can be reached via email at jeh@spscards.net.
EMV chip card payments and near-
field communication contactless or
mobile wallet payments.

Also understand the terms of your
partnership with the provider,
including whether you will receive a
flat rate or a percentage, and whether
they offer service and support to you
and your customers.
Are cash discount
programs legal?
Although credit card surcharges are
legal in some states, cash discount
programs are legal throughout the
U.S. The Durbin Amendment of the
Dodd-Frank Wall Street Reform and
Consumer Protection Act states that
credit card companies may not inhibit
merchants from encouraging their
customers to pay with other forms
of payment besides credit cards. So,
using a discount as an incentive to
pay cash is legal. However, you must
follow certain requirements and best
practices:
• Offer the cash discount to ev-
eryone. Merchants are not per-
mitted to offer it only to certain
customers.

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