Frequently Asked Questions
How does this program work?
By uniformly assessing a set customer service fee across all products and payment types, merchants utilizing the Net Zero program meet the standard regulations that have been set by the major card service providers, state law, and federal law. As part of our regular standard list product pricing, a small service fee (much like an automatic service gratuity applied in some dining locations) is assessed on all sales regardless of how payment is made including checks, cash, credit cards, gift cards, etc. Refer to the Durbin Amendment for additional information.
Is Net Zero a Cash Discount or Surcharge Program?
Net Zero offers both a Cash Discount and Surchage Program.
Won’t my customers be upset by the fee and not want to do business with us?
Explain to your customers that this program gives them an incentive to pay with cash. The fees they will pay if they opt to pay by credit cover the increasingly high costs of card processing, fees that are waived when payment is made by cash. Understandably, no one wants to pay fees for anything. The reward for paying with cash instead of using a card is cheaper than most ATM fees and allows merchants to offer quality goods and services without having to raise their prices. In our experience, most customers are very understanding of this and will either opt to pay cash or accept the terms of paying by card.
Why can’t the rate be lower?
In order to save merchants the most money possible, the rate covers all processing fees with the exception of terminal fees: transaction fee, batch fee, PCI compliance fee, statement fee, interchange fees, and so on.
Will this program eliminate my monthly fees all together?
While we’d like to be able to do so for you, it’s impossible to eliminate fees completely due to variances in the Interchange Billing Structure. However, merchants who participate in this program, typically see their fees go from thousands to less than $100 per month.
How long has this program been around?
We launched Net Zero Processing Fees in April 2018 but the concept of the program has been around for decades, being used in Europe and at gas stations, departments of motor vehicles, post offices, schools, and courts across the United States.
Why do I have to display a sign in my store disclosing the program?
Visa and MasterCard requires a disclosure be clearly visible in the business, a set of rules they established in 2013 to protect cardholders and the integrity of merchants. Not properly disclosing participation in the program violates Visa and MasterCard’s guidelines. As a result, you could be subject to penalties up to and including having your merchant account privileges revoked.
Can I use my existing payment technology for this program?
Yes, if your equipment is compatible with the program. If it’s not, we will typically recommend a new payment terminal machine that is compatible. In order for this service to work, the terminal we provide features unique software that allows the cash adjustment to take place. Every customer receipt will show a line item for the non-cash adjustment.
Cash Discount Specific
Frequently Asked Questions
Is providing a cash discount legal?
Thanks to the Durbin amendment of the 2010 Dodd-Frank law, business owners have a completely legal way to pass on all or a percentage of their processing costs to their customers.
Are cash discounts allowed by Visa and Mastercard?
Yes, cash discount programs are permitted under the Visa and Mastercard operating rules.
What are the differences between a Cash Discount Program and surcharging?
Cash discounts are NOT surcharges. While cash discounts and surcharges may seem similar, they are quite different.
A Cash Discount vs. Surcharge
Cash Discount: When a business owner offers a discount to customers who pay by cash or check.
Surcharge: When a business adds an additional fee to purchases made with a credit card.
Surcharging also carries additional requirements:
• Cash discounts in their true form are allowed in all 50 states but a handful of states have laws against surcharge programs. If you surcharge in a state with a law against it, you’re breaking the laws of that state. As of October 1, 2019 surcharging is prohibited by law in Colorado, Connecticut, Kansas, Maine, Massachusetts, and Oklahoma, according to Visa.
• Prior to surcharging, a merchant must be registered with Visa, Mastercard, and Discover.
• A surcharge cannot exceed 4 percent.
• Signage that displays surcharging must be prominently displayed where payments are accepted.
What types of merchants can participate in Priority Payment Local’s Net Zero Processing Fees Program?
A Cash Discount Program is the ideal solution for a variety of service-based industries, including: retail, food and beverage, and personal and professional services. Businesses that benefit most from our program are those that have an average ticket of less than $1000.
What kind of disclosures are required to use a Cash Discount Program?
At Priority Payments, we take an honest approach to pricing and merchants who participate in our Cash Discount Program are required to do the same. Merchants must clearly list their service fee/charge and cash discount on all customer receipts. In addition, they are required to post signage at the entrance of their business and where payments are accepted. The signage must indicate that all transactions now include a service fee and the amount of the fee that will be charged.
How is the fee noted on the customer receipt?
The term “Non Cash Adjustment” will appear on all customer receipts for merchants who participate in Net Zero.
Have additional questions? Contact us: NETZERO@PPLOCAL.IO, 800-717-1250.