What is Cash Discounting?

You may have started hearing more and more people talking about cash discounting or credit card surcharging these days. In the past this was done by many gas stations or retailers that wanted to incentivize people to use cash, allowing them to not incur credit card fees and therefore making more profit. 

Restaurants and bars are now increasingly turning to cash discounting as a way to combat increasing costs especially those related to processing credit card payments. By implementing a cash discount, many businesses can gain 2.5% – 3.5% more revenue from the same transactions they are already doing.

In Focus, you can specify the percentage surcharge increase for credit card transactions so you do not need to adjust pricing on each individual item. By default, the total displayed to a guest will be the higher price and you can have the cash amount both on the POS screen as well as the guest receipt for presentation. Verbiage can also be added to the guest receipt explaining and encouraging guests to use cash.

For your staff, there is no change in the transaction process. They ring the items as they normally would and select the applicable payment option. If the tender is cash, then the discount will automatically apply.

Before implementing cash discounting or a credit card surcharge, be aware of any local laws that may prevent you from collecting the extra dollar amount or make it taxable. In most areas communicating the price difference to customers is required and in extreme circumstances, you must also list the cash vs. credit prices by each menu item. You also cannot charge more than what your actual processing fees are. Doing so could violate your processing agreement and also be met with legal action.

If you move forward with offering guests a cash discount make sure to notify your accounting person as well as your credit card company so they are aware of this policy change. Visa also has a great information page with example signage, FAQ, and information about notifying the card brands.

Need help setting up cash discounting in Focus? Check out the knowledge base article on setting up cash discounts or contact our Helpdesk.



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