Both cash discount programs and surcharging help merchants reduce processing costs, but they work differently and have different legal requirements. Getting the distinction wrong can put you in violation of card network rules or state law.
Cash Discount Programs
A cash discount program posts the card price as the standard price and discounts customers who pay cash. Legal in all 50 states. The key compliance principle: you are rewarding cash customers, not penalizing card customers.
Surcharging
Surcharging adds a fee specifically for credit card use. It is prohibited in Connecticut, Massachusetts, and other states. Card network rules require advance notification to Visa and Mastercard. It can only be applied to credit cards, not debit.
Which Is Right for Your Business?
- Cash discount: Best for retail, restaurants, and service businesses where signage can be clearly displayed
- Surcharging: Best for professional services (law firms, medical offices) where state law permits it
- Dual pricing: Best for businesses with posted menus or price lists
Not sure which program makes sense? Upload your statement and we'll review your situation to recommend the best approach.
Get a Program RecommendationFrequently Asked Questions
Is it legal to charge customers extra for using a credit card?
Surcharging credit cards is legal in most states with specific disclosure requirements. Cash discount programs are legal in all 50 states. Dual pricing (showing both prices) is also universally legal.
Can I surcharge debit card transactions?
No. Card network rules prohibit surcharging debit card transactions, even when a debit card is run as credit. Surcharging can only apply to credit card transactions.