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Eliminate Processing Fees Entirely
The Cash Discount Program — Compliant in All 50 States
PaySmart Technologies offers a fully compliant cash discount program that lets US merchants eliminate credit card processing fees — legally, transparently, and without losing customers.
A Real Example
$10,000/month in card sales
$3,600
saved per year
What Is a Cash Discount Program, Exactly?
A cash discount program is a compliant pricing model authorized by federal law. Instead of absorbing card processing fees as a cost of doing business, the merchant lists a single posted price that already includes the cost of card acceptance, then offers a discount to any customer who pays with cash.
The mechanics are straightforward. Imagine a coffee shop charging $5.00 for a latte. Under a cash discount program, the menu would show the latte at $5.20 (or display "All prices include a 4% service fee — discount given for cash"). A customer paying by card pays $5.20. A customer paying with cash receives a discount and pays the original $5.00. The 20-cent service fee on the card transaction covers PaySmart's processing cost — so the merchant's effective rate is zero.
The program is enabled at the terminal: the POS system automatically calculates and applies the appropriate amount on each receipt, and signage at the door and at the register clearly discloses the program. The result: merchants who used to pay $250–$5,000 per month in processing fees now pay essentially nothing, while customers retain the choice of how to pay.
Cash Discount vs. Surcharging — A Critical Legal Distinction
These two programs sound similar but are treated very differently by state law and by Visa and Mastercard. Mixing them up can expose a merchant to fines, network penalties, or even legal action. Here's the difference:
Cash Discount
- Posted price includes card cost. Cash payers receive a discount.
- Legal in all 50 states. Authorized by the Durbin Amendment.
- No cap on amount. Service fee can match true processing cost.
- No advance notice required to Visa or Mastercard.
- Receipt shows discount applied for cash payment.
Surcharging
- Posted price excludes card cost. A fee is added on top for card payers.
- Banned or restricted in CT, MA, ME, and others.
- Capped at 3% by Visa and Mastercard rules.
- Requires 30-day notice to the card networks before launching.
- Receipt must itemize the surcharge as a separate line.
PaySmart Technologies offers cash discount programs only — they are simpler, fully compliant nationwide, and produce greater merchant savings than surcharging.
State-by-State Compliance Notes
Cash discount programs are explicitly legal in all 50 states and the District of Columbia. The federal Durbin Amendment overrides any state restriction on cash discounts. Surcharge programs, however, are restricted or banned in the following jurisdictions:
States that ban or heavily restrict surcharging:
Connecticut, Massachusetts, Maine. Surcharging is also subject to disclosure rules in New York and Colorado after recent legislation.
Cash discount programs:
Legal in all 50 states. No additional registration or notice required.
This page is informational, not legal advice. PaySmart configures every cash discount account to meet current federal and state requirements; consult an attorney for guidance specific to your business.
The Math: How Much a Cash Discount Program Actually Saves
Below are three real-world merchant profiles showing the annual savings of moving from traditional credit card processing to PaySmart's cash discount program. Numbers assume an average effective rate of 2.9% on standard processing.
Independent Coffee Shop
$10,000 / month
Was paying
$290 / month
Annual savings
$3,480 / year
Full-Service Restaurant
$45,000 / month
Was paying
$1,305 / month
Annual savings
$15,660 / year
Auto Repair Shop
$80,000 / month
Was paying
$2,320 / month
Annual savings
$27,840 / year
Why PaySmart's Cash Discount Program Is Different
Many processors sell "cash discount" programs that are actually disguised surcharge programs — a compliance disaster waiting to happen. PaySmart Technologies builds every program to current Visa, Mastercard, FTC, and state-level rules.
Fully compliant signage included at no cost — door, register, and online
Terminal programmed to apply the discount automatically — no math at the register
Receipts clearly itemize posted price and cash discount amount
No long-term contract; switch back to standard processing any time
Dedicated US-based account manager and 24/7 support
Free side-by-side quote so you can compare cash discount vs. interchange-plus
Frequently Asked Questions
Related Guides
Compare cash discount with other ways to lower your payment processing costs.
How Credit Card Processing Works
Understand interchange, assessments and processor markups before changing your pricing.
Interchange-Plus Pricing
An alternative to cash discount: keep accepting cards and pay only the true interchange cost plus a small markup.
Clover POS Systems
Clover terminals support compliant cash discount and dual pricing out of the box.
SkyTab POS for Restaurants
A restaurant-focused POS that integrates dual pricing, online ordering and tip flows.
Small Business Payment Processing
A practical, plain-English playbook for picking a processor as a small business.
See How Much You'd Save
Send PaySmart Technologies your last merchant statement and we'll show you, in writing, exactly what a cash discount program would save your business this year.
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