By Erica Houskeeper on May 26, 2020
Now more than ever, merchants are looking for creative ways to save money and adapt their small business during the Covid-19 era. Lowering and even reducing credit card processing fees up to 100% is one popular way to do that.
Credit card processing fees can add up to be a considerable expense, usually costing merchants between 1.5% to 4% per credit card transaction. These fees, known as interchange fees, are charged by networks, including Visa, Mastercard, American Express, and Discover.
One way to offset your credit card fees is to establish a traditional cash discount program. A cash discount offers a discount to customers who pay with cash instead of a credit card. Discounts for cash are permissible in all 50 states per the Durbin Amendment, which states that businesses may offer a discount to customers as an incentive for paying with cash.
But transparency is key and can be tricky with a typical cash discount strategy. Make sure your customers are aware of your cash discount program. You’ll need to post signs at your store’s entrance, inside your store, and at the register that clearly outlines your policy. The signage informs consumers and is required by law.
The Edge Program: A Cash Discount Alternative
North American Bancard offers an improved version of the traditional cash discount program, called The Edge. The key difference for the Edge is that it allows merchants to give two prices for each item: a cash price and a credit card price. This is not only more transparent, but it provides a clear incentive for your customers to pay with cash.
What's more, the Edge applies to all credit card sales in any amount, and allows you to stay in control of rising merchant processing rates.
- No monthly or annual costs
- No PCI compliance fees
- Free equipment and next day funding
- Compatible with Payanywhere, Paradise, Retail Cloud and Mynt
Here’s how it works:
You receive a free pre-programmed terminal that knows the exact cost of each item and automatically adjusts the pricing based on the method of payment.
This is similar to the “gas station model”, where you see one price for cash and one price for credit card on the billboards outside. The smart terminal handles all of the calculating for you, and you get the same amount in your bank account on all sales.
For example, if your customer is purchasing an item for $10, they can choose to pay $10 in cash, or they can pay $10.40 with their credit card to benefit from the rewards points they normally receive on their credit card. In both cases, you end up with $10 net in your bank account.
Each merchant is provided with free signage that you post in your store window and at your POS counter that encourages your customers to pay with cash and explains that every item has a cash and credit card price.
The Edge is a more efficient way to process credit cards, allowing you to keep more on your credit card transactions, and curbing expensive processing costs that dig into your bottom line every month. It enables merchants to eliminate the never-ending cycle of rate negotiation once and for all.
Average business owners save up to 100% of the money they usually spend on processing with the Edge, giving merchants a reliable way to get their costs down and put that money back in their business.
The Edge is built to support merchants in all 50 states and encourages them to follow the commerce and pricing laws in their specific state. The programming allows for the merchant to decide how they price their items in accordance with their state laws.
If you'd like to learn more about the Edge program and how it can help your business save on credit card processing costs, you can read more here.