Cash discount vs. surcharge: what's the difference?
A cash discount posts a single higher price and gives a discount to customers who pay with cash, while a surcharge adds a fee on top of the listed price for credit payments. Cash discount/dual pricing is the more flexible, widely accepted approach and is what Velocity recommends for most merchants.
Both models help offset the cost of accepting cards, but they work differently and carry different rules.
Cash discount / dual pricing. You post a card price and a cash price. Customers who pay cash get the lower price. There's no card-brand cap on the amount, it applies to credit and debit, and it's straightforward for staff and customers to understand.
Surcharging. You add a fee to credit transactions on top of your listed price. Surcharges are capped by the card brands, can't be applied to debit, require advance notice to the networks, and are restricted in some states.
For most businesses, a dual-pricing / cash discount setup is simpler and saves more. Velocity configures the signage, receipts, and terminal so you stay compliant either way.
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