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Cash Discount Credit Card Processing

A credit card processor provides a service or device that allows merchants to accept credit cards as well as send credit card payment details to the credit card network. It then forwards the payment authorization back to the acquiring bank.

Merchant services is a broad category of financial services intended for use by businesses.^[1] In its most specific use, it usually refers to merchant processing services that enables a business to accept a transaction payment through a secure (encrypted) channel using the customer's credit card or debit card or NFC/RFID enabled device. More generally, the term may include:

Credit and debit cards payment processing
Check guarantee and check conversion services
Automated clearing house check drafting and payment services
Gift card and loyalty programs
Payment gateway
Merchant cash advances
Online transaction processing
Point of sale (POS) systems
Electronic benefit transfer programs, such as ration stamps (called food stamps in the U.S.).

Cash Discount Credit Card Processor

A cash discount program is a type of credit card processing that passes the cost of acceptance back to customers who choose to pay with a credit card or debit card. Cash discount merchant services allow business owners to continue to accept all major credit cards, but without the loss of 3-4% in fees.

Is Cash Discount Legal In MN?

2017 Minnesota Statutes

325G.051 SURCHARGES ON CREDIT CARDS.

Subdivision 1.Limitation; prohibition.

(a) A seller of goods or services may impose a surcharge on a purchaser who elects to use a credit card in lieu of payment by cash, check, or similar means, provided (1) the seller informs the purchaser of the surcharge both orally at the time of sale and by a sign conspicuously posted on the seller's premises, and (2) the surcharge does not exceed five percent of the purchase price.

(b) A seller of goods or services that establishes and is responsible for its own customer credit card may not impose a surcharge on a purchaser who elects to use that credit card in lieu of payment by cash, check, or similar means.

(c) For purposes of this section "surcharge" means a fee or charge imposed by a seller upon a buyer that increases the price of goods or services to the buyer because the buyer uses a credit card to purchase the goods or services. The term does not include a discount offered by a seller to a buyer who makes payment for goods or services by cash, check, or similar means not involving a credit card if the discount is offered to all prospective buyers and its availability is clearly and conspicuously disclosed to all prospective buyers.

Subd. 2.Penalty.

A seller who violates this section is subject to a civil penalty of not more than $500 and shall refund the surcharge to each buyer.

History:

1987 c 172 s 1