A properly run cash discount program enables the business to reward cash paying customers with a discount at check-out.  Card-paying customers pay a slightly higher rate that includes the cost of processing, usually 3.5% to 4% more. 

To run this program compliantly, the restaurant must do the following:

a.  List all prices on the menu and signage with the card price for every item.  Cash price plus the fee imposed for the card payment, let’s say it’s 3.75% for example.

b.  Add signage at the entrance and at the point of sale or register indicating that a discount is applied if the bill is paid in cash.

c.  Both debit and credit cards can be assessed a fee of 1% up to a maximum fee of 4%.

With a dual pricing program, customers are presented with both a cash price and a card price for each menu item.  Compliance under dual pricing includes the following conditions:

a.  All prices listed on the menu and signage must contain both the cash price and the card price.  For example… 

Bubba’s Burger Plate    $ 8.99/$ 9.30

b.  Signage must also be added at the entrance and at the register.

c.  Both debit and credit card payments can be added from 1% to 4%.

Surcharging has been around a long time and is the practice of adding a “fee” at check-out when a customer pays with a card. 

We see this often as a “Convenience Fee” when paying our utility bills online as one example. 

Recent changes from Congress and the Card Brands restricts surcharging as follows:

a.  Surcharges cannot be added when a debit card is used for the purchase.

b.  Credit cards carry a maximum allowable surcharge of 3%.