A brief history into the beginning of Cash Discounting
Cash Discounting has been around since other fee-laden forms of payment came into existence during the revolutionary days of the 1950s. e.g. plastic bank cards.
Gas stations were the very first early adopters because they found profit margins to be nearly non-existent.
Luckily, with the increase in road travel paired with a new method of accepting cards, they began to thrive.
What it is...
What exactly is Cash Discounting?
Gas stations started offering several cent discounts per gallon (roughly 3 to 4% of their total sale price) to purchases over a high enough number of gallons. Shortly after, gas station restaurants and diners followed suit by reducing the cost by several % for cash paying customers.
Fast forward to present time and business owners from industries across the board are using it to completely eliminate processing fees from accepting card payments.
How it works...
How does Cash Discounting Work With Genie Payments?
For ease of transition, in lieu of spending the time to physically change your prices displayed, we have done it for you on your receipt. All prices listed in your business or online will now become your cash prices. We provide, at no cost, Point-Of-Sale systems with software to automatically calculate 3 to 4% increase for card based transactions. For cash transactions, the software removes the percentage paid by card, leaving your customers with a receipt total equal to your cash prices listed in your store that states a 3 to 4% discount has been applied.
Who it's for...
Many industries benefit from Cash Discounting.
Some of the largest cash discounting embracers are in the highly taxed food and beverage service industries whom also have, historically, the lowest profits margins in any type of small business. However, it's not just for the food and beverage service industries.
Businesses such tire and automotive repair, retail stores, grocery and even bars/pubs all benefit from cash discounting. Tourist destinations and and local clientele all happily paying a little bit less for cash and a little bit more for the convenience and speed of a card payment.
Signage & training...
How will customers find out?
Custom signage designed for your business explaining the change will be posted on your entrance doors, by the point-of-sale device/s and at each table for establishments with table service. Each employee is also expertly trained on what to say if engaged with a customer. All signage follows all legal US guidelines for proper cash discounting literature and has been worded to best reflect the feedback of tens of thousands of your customers gathered over years of conclusive market research.
Frequently Asked Questions
We know it can be a little confusing, and the last thing you want to think about is credit card processing. That's why we've put together a quick FAQ guide to help answer some of the most common questions we're asked.
What’s the average amount you save clients per month with Cash Discounting?
Our clients were typically being billed “interchange - PLUS” pricing with their processing before switching to Cash Discounting. This means they paid interchange fees charged by the brands like VISA and Mastercard PLUS they paid their banks and processors with another fee charged separately. Our clients save 100% of BOTH resulting in an average savings of $2,250 per month for a client that processes $75,000 per month.
Will my customers be upset?
Cumulative market research data shows two things: First, at most, roughly 1% of customers ever complained about the cash discounting program. Second, after 90 days complaints had dropped to virtually zero. We also assist you by giving you (custom to your brand) signage to ensure all customers are kept in the loop.
What will the custom signage say?
The signage will be custom designed for your specific place of business. e.g.
“Your Sunset Terrace family works hard to bring you a one of a kind experience. Costs are high to run a restaurant and card brands like VISA charge us to accept your card payment.
In an effort to reduce cost and continue offering the same food and drinks you love, all prices listed include a 3.99% discount for cash-paying customers.
If paying by card you will notice this small 3.99% charge on your receipt.
We greatly appreciate your business.”
Does Cash Discounting really help increase profit margins? How is that possible?
Cash Discounting is seen as the magic wish for industries, such as restaurants and bars, interested in eliminating processing fees and thus, raising their profit margins from the national average of roughly 5% to 8% with the switch of a POS. It’s simple, your customers pay 3.99% more for their card payment. 100% of your processing fees are covered in that
If it's free, how do you make your money?
From the 3.99% customers pay per transaction, roughly 2.25% +/- .25% is paid to interchange. Leaving 1.5% to 2%. Then bank fees and processor fees are subtracted. This ranges from .5% to 1%. Leaving .5% to 1.5% paid to Genie Payments. Then our agreement with the bank subtracts your monthly and transactionally recurring costs. e.g. account fee, next day funding, batch fees, etc. (averaging roughly $50/mo), Finally, from our earnings, we pay you 10% to 25% in our monthly cash rebate loyalty program. And lastly, to any account referrer*, 15% of said account’s net earnings (as described above) will be paid monthly, and for the life of the account. Currently 77.8% of Genie clients are referrals.
What kind of fees can I expect after switching to Cash Discounting?
Absolutely none. Your bill will always *$0. (*customer responsible for chargebacks and retrievals at cost)
Do I have to buy a bunch of new equipment or can I use my own?
If you own compatible hardware, absolutely. If not, we will provide a POS device or system to you, free of charge.
Can I just add 3.99% to each transaction and stay with my current processor?
Unfortunately not. Adding 3.99% to each transaction would be a considered a surcharge. Surcharging is against the card brand's policies unless the account is set up to accept them properly. Our cash discount program is approved by all card brands, in all 50 states.
Why not just use a flat fee instead of 3.99%?
Card Brands like VISA require a percentage if your average transaction amount is greater than roughly $21. In this instance, every transaction’s fees associated would also be greater than the flat fee charged resulting in a bill for you, which Genie doesn't agree with.
Can the 3.99% be lowered?
Unfortunately, no. Here’s why: From 3.99%, roughly 2.25% +/- .25% is paid to interchange. Leaving 1.5% to 2%. After bank and processor fees are subtracted (another .5% to 1%), we're left with just .5% to 1.5% paid to Genie Payments. From there, our agreements with the banks subtract your monthly and transactionally recurring costs. (e.g. account fees, next day funding, batch fees, etc.) Finally, from our earnings, we pay you back 10% to 25% from our merchant loyalty program, and an additional 15% from any referrals' net earnings (as described above) which are promptly paid every month, and for the life of the account. Currently 77.8% of Genie clients are referrals.
What is the merchant loyalty cash back program I keep hearing about?
When putting together a solution for our restaurateurs, we wanted to make something that no one else was doing. And Genie granted that wish. We created the very first merchant loyalty cash back program. All Genie Payments clients receive 10% to 25% of net earnings in our cash rebate loyalty program each month in the form of electronic or paper check methods. We also pay out 15% of net earnings of any referral, for the life of the account!