In light of the new memo that was just released from Visa, they announced the non-cash adjustment programs as non-compliant surcharging. This announcement and Visa and Mastercard’s outlook on non-cash adjustments put heavy scrutiny on current “Cash Discounting” programs.
Dual Pricing Merchant Services is a merchant account that allows a merchant to show a cash price and a card price at the point of sale. What Dual Pricing does is eliminate the look of surcharging, non-cash charges, and other methods of presentation that Visa may consider non-compliant. This practice is very common among gas stations who typically offer two prices for fuel.
Dual Pricing Merchant Services is an alternative to Cash Discount programs. With Dual Pricing, when paying with a card, there is not an additional line item added to the “cash price.” Rather, there is one price for paying with cash and one price for paying with a card. After a purchase is made, there is one total price on the receipt when paying with either option.
You may be wondering, how does Dual Pricing Merchant Services work? In the past, for a non-cash adjustment or a compliant surcharge merchant account, if a cash price was listed at $10, a separate line item of 4% would be added labeled non-cash adjustment or service fee. The total when the customer pays with a card would be $10.40.
With a Dual Pricing merchant account, during the time of sale the customer has the option to choose between paying a cash price of $10 or a card price of $10.40. When finalizing their purchase, there is only one price and one line item printed on the receipt. In this case it would be either “Cash Price: $10” or “Card Price: $10.40.”
When it comes to Dual Pricing merchant accounts , there are a few things to keep in mind. Depending on your state’s laws, you may need to list your cash and card price on the shelf, menu, etc. However, the best way to display two prices so that it is clear to your customer is on the terminal and receipt.
In addition to this, it is important that you have compliant signage in your business to notify customers before the transaction is started.
As an agent, you might be wondering, does setting up my merchants with a Dual Pricing Account affect my income or my residuals that are different when offering the traditional cash discount program? The short answer is no. In both scenarios, as an agent your earnings are the same. The only difference is the way the merchant communicates the Dual Pricing to their customers. This announcement and Visa’s outlook on non-cash adjustments makes for a great pivot to the Dual Pricing program.
