None of these programs would exist without the Durbin Amendment, part of the Dodd-Frank Act.
In simple terms, the Durbin Amendment gave merchants the legal right to:
Before this, card networks had much tighter control over merchant pricing practices.
After Durbin, merchants gained flexibility.
But flexibility comes with rules.
Let’s be clear:
You cannot eliminate interchange fees themselves.
Interchange is set by networks like:
Those fees are baked into the payment ecosystem.
What you can do is structure your pricing, so the cost of card acceptance is offset — legally.
That’s where cash discounting and surcharging come in.
This is where most confusion happens.
They are not the same.
And they are not regulated the same.
A cash discount program:
From a legal standpoint, this is considered a discount for alternative payment, not a surcharge.
That distinction matters in many states.
Cash discount programs are generally permitted nationwide when implemented properly.
The complaint way is to post the higher prices on your menu, shelf etc.. and offer a discount if customer want to pay with Cash, ACH or Check.
A surcharge:
Surcharging is legal in most states — but not all states treat it identically.
That’s why understanding your local law matters.
Some states regulate:
Laws change. Court rulings are evolving. Enforcement varies.
We are not the compliance police.
But ignoring state-specific requirements can create:
The smart approach is simple:
Know your state’s rules.
Choose the structure that fits your business.
Implement it properly.
Regardless of your state, if you surcharge, you must comply with rules from:
These typically require:
Cash discount programs have fewer network restrictions — but still must be structured properly.
That depends on:
Retail and restaurants often prefer cash discount programs.
Professional services and B2B environments sometimes prefer surcharging.
There is no universal answer.
There is only the right answer for your business model.
These mistakes are avoidable.
Let’s use a simple example.
If your business processes:
$75,000 per month
At a 2.9% effective rate
That’s rough:
$2,175 per month
Over $26,000 per year
Even partial cost recovery improves margin significantly.
That’s not theory.
That’s operating cash flow.
Some businesses:
There’s no moral high ground here.
Just informed decision-making.
We’re not here to tell you which program to choose.
We’re here to make sure you:
Because saving Money only works if you keep it.
CLICK HERE TO FIND MORE ABOUT OUR PROGRAMS
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