Welcome to XeroFees FAQ page.
Here you’ll find answers to commonly asked questions about how the XeroFees cash discount program will help you virtually eliminate your credit card processing fees.
Please contact us if you need additional information.
What Is A Cash Discount Program?
A cash discount program is a deduction allowed by a seller of goods or by the provider of services put into place in order to offset the expense of accepting charge cards.
Businesses can accept various types of payments including cash and credit cards such as Visa, MasterCard, Discover, and American Express. Many businesses are collecting most of their payments through credit cards and through various other electronic methods but the fees are high and increasing and for a small business that can really affect the bottom line.
In order for your company to accept credit cards, you first have to set up a credit card merchant account, and accept all the fees that go with it. To offset the heavy card fees, you can ask your customer to pay cash, offering the services at a discounted rate or accept that you need to charge a fee to use the card. The seller or provider often refers to the cash discount as a sales discount. The buyer often refers to the same discount as a purchase discount.
Why am I just hearing about this Program?
It is gaining wide traction now in the USA as it is legal in all 50 states. The program has been used commonly in our country at gas stations where a cash discount is offered at the pump for over 15 years. Many national, state and local governments including the DMV, Secretary of State, Post Offices, Schools, Courts, and the IRS implement a Service Fee.
Explain a Surcharge vs. a Cash Discount?
This is the most popular question we get asked. While the two programs may pose a similar outcome to the customer, they are very different especially according to the rules and regulations of Visa and MasterCard.
A surcharge is currently not allowed in 10 states (California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma and Texas, plus the U.S. territory of Puerto Rico).
The Cash Discount program is legal now in all 50 states. The merchant is not implementing an additional fee for accepting a credit card; rather, the business owner is providing a discount for those who pay with cash. This is a clear distinction, and one that Visa, Mastercard, and the courts have agreed upon.
Can I keep existing credit card processing terminal?
No, according to Visa and MasterCard, merchants must chose one payment processing method in their business. However, should you convert to the XeroFees Cash Discount Program and wish to go back to traditional payment processing, we will, at no cost, set up this merchant account again for you.
Will a Cash Discount Program totally eliminate my monthly card processing fees?
American Express still has a 15 basis point fee that must continue (this is a fee passed through by AMEX) and will appear on your monthly bill.
With regard to your Visa/MC fees, 99% of these fees will be covered. With some merchants, XeroFees may charge a nominal monthly fee – typically less than $45.00. Using the XeroFees program, our typical business owner is eliminating the majority of their processing fees.
Does my business charge a % or a flat fee?
The overwhelming majority of our clients are charging a 3.75%-4.00% service fee. A small percentage of our merchants are charging a flat fee. XeroFees encourages the % as it guarantees covering your processing costs.
In some cases, the merchant can develop a hybrid solution and charge only 50% of the service fee to the consumer. This will be developed on a case by case basis with the business owner depending on the average ticket size and other variables which XeroFees will discuss when setting up your Cash Discount program.
How do I notify my customers of my new program?
A legal cash discount program requires that customers be notified prior to the sale. Plus we will provide signage that explains in simple terms the new Cash Discount Program.
What types of credit card terminals works with this program?
XeroFees has a range of terminals and POS systems available that will be programmed for you, and downloaded at our office and shipped via UPS. Upon arrival, just plug it in and you will be in business with your Cash Discount Program. Our customer care team is available to walk you through the simple process and to answer any questions that may arise.
Do you work with POS and Gateways?
Yes, XeroFees has proprietary systems and gateways that upon checkout will be able to process your transactions using our Cash Discount Program.