Fee Programs

Offset your credit card processing costs by passing fees to customers who pay with cards.

Overview

Credit card processing fees typically range from 1.5% to 4% per transaction. Fee programs let you recover these costs while giving customers who pay with cash or ACH a better price.

Which to Use?

Comparison

Program	How It Works	Customer Sees	Best For
Surcharge	Fee added to card transactions at checkout	Base price + fee as separate line item	Transparency; required in some states
Cash Discount	Fee built into price; discount given for cash/ACH	Single price with discount for non-card	Simpler receipts
Dual Pricing	Two separate prices displayed; fee is taxed	Card price and cash price (fee taxed separately)	Retail with posted prices
Dual Pricing v2	Two prices; fee fully embedded in subtotal	Card price and cash price (cleaner math)	E-commerce, invoicing

Differences

All examples below use: $100 subtotal, 7% tax, 3.99% fee

Program	Card Total	ACH/Cash Total	Where Fee Appears
Surcharge	$111.27	$107.00	Separate line after tax
Cash Discount	$111.27	$107.00	Built into subtotal
Dual Pricing	$111.27	$107.00	Separate line, taxed
Dual Pricing v2	$107.00	$102.89	Embedded in subtotal

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Surcharge

Surcharge adds a fee (typically 3-4%) to transactions paid with a credit card. The fee appears as a separate line item on the receipt.

How It Works

1. Customer sees the base price
2. At checkout, if paying by card, the surcharge is calculated on the subtotal + tax
3. The surcharge appears as a separate line item
4. ACH and cash payments have no surcharge

Calculation Example

Given: $100.00 subtotal, 7% tax, 3.99% surcharge

Line Item	Calculation	Amount
Subtotal	—	$100.00
Tax	$100.00 × 7%	$7.00
Surcharge	$107.00 × 3.99%	$4.27
Total		$111.27

When to Use

• Required by law in certain states for fee disclosure
• When you want maximum transparency about the fee
• When your advertised prices don't include the fee

Compliance Note

Surcharging is prohibited or restricted in some states (Connecticut, Maine, Massachusetts, Oklahoma, and others). Check your state's regulations before enabling surcharge programs.

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Cash Discount

Cash Discount builds the fee into your prices, then provides a discount when customers pay with cash or ACH. The receipt shows the discount rather than a surcharge.

How It Works

1. Your prices already include the fee
2. At checkout, card customers pay the listed price
3. Cash/ACH customers receive a discount equal to the fee
4. The discount appears as a line item on the receipt

Example

Given: $100.00 base amount, 7% tax, 3.99% fee built in

Line Item	Calculation	Amount
Amount	—	$100.00
Tax	$100.00 × 7%	$7.00
Fee	$107.00 × 3.99%	$4.27
Subtotal	$100.00 + $4.27	$104.27
Total		$111.27

When to Use

• When you prefer to show a "discount" rather than a "fee"
• When your pricing already accounts for card processing costs
• When operating in states with surcharge restrictions

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Dual Pricing

Dual Pricing displays two different prices to customers: a higher price for card payments and a lower price for cash/ACH. The fee is calculated separately and taxed.

How It Works

1. Customer sees both prices upfront (e.g., "Card: $103.99 / Cash: $100.00")
2. The fee is calculated on the subtotal only (not on subtotal + tax)
3. Tax is applied to both the subtotal and the fee separately
4. This results in the fee being taxed

Example

Given: $100.00 subtotal, 7% tax, 3.99% fee

Line Item	Calculation	Amount
Subtotal	—	$100.00
Tax (on subtotal)	$100.00 × 7%	$7.00
Fee	$100.00 × 3.99%	$3.99
Tax (on fee)	$3.99 × 7%	$0.28
Total		$111.27

When to Use

• When you want to clearly advertise two different prices
• Retail environments with posted price signs
• When local regulations require separate price displays

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Dual Pricing v2

Dual Pricing v2 is similar to Dual Pricing but embeds the fee entirely within the subtotal. For ACH/cash payments, the system calculates a "derived" lower amount that, when the fee is added back, equals the original price.

How It Works

1. Card customers pay the listed price (fee is invisible, built into the price)
2. For ACH/cash, the system reverse-calculates a lower base amount
3. The discount is shown on the receipt
4. Results in a lower total for ACH/cash than other programs

Example

Given: $100.00 subtotal, 7% tax, 3.99% fee (embedded)

Line Item	Calculation	Amount
Amount	—	$100.00
Tax	$100.00 × 7%	$7.00
Total		$107.00

The fee is already embedded in the $100.00 price—no separate line item.

Math

The "derived amount" is calculated by removing the embedded fee:

Derived Amount = Original Amount ÷ (1 + Fee Rate)
Derived Amount = $100.00 ÷ 1.0399 = $96.16

This ensures that when the fee is added back to the derived amount, you get the original price.

When to Use

• E-commerce where you want one clean displayed price
• When you want ACH/cash customers to see meaningful savings
• Invoicing where fee breakdowns aren't shown upfront

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Comparison

Receipts

Here's how each program appears on a receipt for a $100 purchase with 7% tax and 3.99% fee, paid by credit card:

Subtotal:           $100.00
Tax:                  $7.00
Surcharge (3.99%):    $4.27
─────────────────────────────
TOTAL:              $111.27

Choosing

If you want...	Use
Maximum fee transparency	Surcharge
To advertise lower prices and add fee at checkout	Surcharge
To avoid the word "surcharge" on receipts	Cash Discount
To show two prices everywhere	Dual Pricing
The fee taxed separately	Dual Pricing
Clean receipts with no visible fee line	Dual Pricing v2
The biggest discount for cash/ACH customers	Dual Pricing v2

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Configuration

To enable a fee program:

1. Navigate to Settings → Fee Programs in your Control Panel
2. Select your desired program
3. Enter your fee percentage (typically 3-4%)
4. Configure which payment methods are exempt (usually ACH and cash)
5. Save and test with a sample transaction

Testing

Always run test transactions with both card and ACH to verify the calculations match your expectations before going live.