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Payment Alliance Inc.
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Cash Discount VS Traditional Processing

CASH DISCOUNT PRICING

Discount pricing, also known as cash discount pricing, is a pricing model that allows merchants to pass on the cost of payment processing to their customers. In this model, the merchant offers a cash discount to customers who pay with cash or non-card payment methods. The advertised price of a product or service is the "credit card," and if a customer chooses to pay with cash, they will receive a 3.5% discount. The machine will automatically charge the 3.5% and pass it to the customer.  

Key features of discount pricing:- Merchants can offset or eliminate their payment processing fees by passing them on to customers.- The advertised price is  the credit card processing price, which incentivizes customers to pay with cash or non-card payment methods.- The additional fee for card payments is often a fixed percentage or a flat fee.

See if your business qualifies

Traditional Pricing

INTERCHANGE PLUS PRICING

Interchange plus pricing, also known as cost-plus pricing, is a transparent and widely regarded pricing structure for merchant service accounts. It is a method used by payment processors to determine the fees associated with processing credit card transactions, providing businesses with a clear understanding of the actual costs involved.


In an interchange plus pricing model, the fees are calculated based on two main components: interchange fees and the processor's markup.


1. Interchange Fees: Interchange fees are the fees set by the card networks (such as Visa, Mastercard, or American Express) and are paid to the issuing banks for each transaction. These fees are standard across all payment processors and are determined by various factors, including the type of card used (debit, credit, rewards, etc.) and the method of transaction (swiped, keyed-in, online, etc.). Interchange fees are non-negotiable and are updated periodically by the card networks.


2. Processor's Markup: The processor's markup is the additional fee charged by the payment processor for their services. This markup is a percentage or a flat fee added on top of the interchange fees. The markup covers the payment processor's costs, including customer support, technology, and profit margin. The markup is where payment processors can differentiate themselves and compete for merchants' business. It is typically a negotiable component of the pricing structure.


With interchange plus pricing, the interchange fees and the processor's markup are clearly separated in the billing statement. This transparency allows businesses to understand the exact cost of each transaction and evaluate the value provided by their payment processor.


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1. Transparency: Merchants can see the actual interchange fees and the processor's markup separately, providing transparency into the cost breakdown of each transaction.
2. Cost Control: Since interchange fees are standardized, the processing costs are more predictable. Merchants can negotiate the processor's markup to ensure they are getting competitive rates and have control over their payment processing expenses.
3. Fairness: Interchange plus pricing ensures that merchants pay the actual cost for each transaction, without any hidden fees or inflated charges.
4. Flexibility: With interchange plus pricing, businesses can more easily adapt to changes in the industry, such as new card types or transaction methods, as the interchange fees remain consistent.

Understanding Markups

The processors we work with

Our trusted partners are the best in the industry. We've done the homework for you.

Merchant Associates Logo

Direct Processing / Interchange

Merchant Associates is a direct processor that offers passthrough deals on low risk merchant accounts. Not all businesses qualify for direct processing. Must have a track record of low chargebacks and established for at least three to five years, based on your industry type. Must complete risk verification.

GoDaddy Processing

Flat Rate Processing

2.5% In Person

2.9% +.30c Invoicing & Pay links

3.5% Manual Entry

Redfynn Logo

Cash Discount Pricing

With a wide variety of technology and low cash discount rates for your customers. Redfynn Technologies comes in at number one for cash discount pricing.

(480) 864-5112

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Phone:   (480) 864-5112  Address: Payment Alliance Inc. 600 W. Ray Rd Ste D2 Chandler AZ 85225

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