Everybody likes cash. It’s green, it’s convenient, and it’s full of instant, no-frills guaranteed purchasing power. Yes, compared to the abstract world of cards and terminals, with their fees and fraud potential, cash has got to be the safer bet, right?
Not always. According to research, cash carries with it inherent risks, including theft from a member of staff, which 29% of organizations polled said they had experienced. Human error is also huge, which 37% of businesses reported that they have lost cash to. The risks of keeping a large amount of cash around should be weighed against any perceived risk that accepting credit cards for small business poses. For most every situation, if updated technology is in place, the merchant is protected from covering the costs of fraud. Try to find the same protections in the unfortunate even that you lose track of your cash…
Cash is also a pain even when it stays where you put it. Every single day, cash demands that the books be reconciled, with 30% of businesses reporting that they have to spend 2 hours or more counting it. Then you’ve also got to ensure that somebody can make it to the bank in time to keep your business’s cash flow going. It’s true that as long as you accept cash, there will be cash to count. Still, a move to accept and encourage other payment methods can dramatically shorten the time you spend each day counting cash to reconcile the books after your doors are closed. No matter how you look at it, managing that cash has an associated cost.
87% of customers, according to the survey, said that they think it’s important to have payment options. This is probably because the other 13% didn’t understand the question right. It is almost universally preferable to give your customers more payment options, not fewer. Customer perception of your business can cost you. It is difficult to quantify that cost, but seeing the benefit when you switch over is easy. If even the dingy donut place in that strip mall by the freeway is offering a variety of payment methods, what’s your excuse?
Apple Pay, Samsung Pay, and the other most common forms of NFC (or near-field communication) payment options, has begun to encroach on cash’s previous position of dominance. Experts are anticipating that as adoption of NFC payments continues its upward trend, that it will be eclipsing cash in popularity within the next 5 years.
In summary, this post should show how it doesn’t quite add up to assume that accepting credit cards for small business carries added costs that cash, which doesn’t carry charges, allows you to avoid. Holding on too tightly to cash costs you too. And while you should probably hold off from putting up the “NO CASH” signs in your window, the ways you can save by accepting cards and other payments makes now the perfect time to contact Moolah.
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A credit card surcharge is an additional fee added to a transaction when a patient chooses to pay with a credit card. The surcharge is intended to help offset the cost of credit card processing and applies only to eligible credit card transactions.
No. Debit card transactions may not be surcharged under any circumstances, even if the debit card is processed as a credit transaction or entered manually.
Yes. Credit card surcharges may not exceed the merchant’s actual cost of accepting credit cards and are capped at a maximum of 3% of the total transaction amount, in accordance with card-network rules and applicable law.
Yes. Card networks require clear and transparent disclosure of any credit card surcharge. Practices must notify patients through appropriate signage at the practice entrance, point of sale, and anywhere payments are accepted. If payments are accepted online, the surcharge must also be clearly disclosed on the practice’s website.
Yes. Some U.S. states and territories prohibit or restrict credit card surcharging. Practices are responsible for understanding and complying with their state’s specific requirements before implementing a surcharge.
No. While Moolah provides tools and general guidance to support credit card surcharging, compliance with all applicable laws and card-network rules is the responsibility of the merchant. Moolah does not provide legal advice and assumes no liability for a merchant’s compliance.
Most major credit card networks permit surcharging when done in accordance with their rules, but additional requirements or restrictions may apply. Practices should ensure they have completed all required network notifications and disclosures prior to enabling surcharging.
Failure to comply with surcharging rules may result in card-network fines, required refunds, or other enforcement actions. Practices should ensure they fully understand all applicable requirements before applying a surcharge.
Flex does not currently offer built-in support for credit card surcharging. If a practice chooses to enroll in a surcharge plan, payments would need to be processed through Moolah’s payment platform, which is designed to support surcharging and integrates directly with Open Dental.
If you are considering introducing a credit card surcharge for your patients, it is important to understand that there are specific rules and regulations that must be followed when enrolling in and operating under a surcharge plan.
This article provides a general overview of common surcharging requirements. This content is provided for informational purposes only and does not constitute legal advice. It is the responsibility of each merchant to review, understand, and comply with all applicable laws, card-network rules, and regulatory requirements, including notification timeframes, signage requirements, surcharge percentage limits, and jurisdictions where surcharging is prohibited.
If you are unsure about the laws or regulations applicable to your practice, you should consult with qualified legal counsel. Moolah assumes no liability for a merchant’s compliance or non-compliance with credit card surcharging rules or regulations.
Transparent Communication
Card networks, including Visa, Mastercard, Discover, and American Express, require merchants to clearly and transparently disclose when a credit card surcharge is applied.
Practices must clearly notify patients of a credit card surcharge through appropriate signage placed at the practice entrance, at the point of sale or terminal, and anywhere payments are accepted. If payments are accepted online, surcharge disclosures must also be clearly visible on the practice’s website. All disclosures must inform patients that the surcharge applies only to credit card transactions.
Surcharge Limits
Credit card surcharges must comply with both card-network rules and applicable law. The surcharge amount may not exceed the merchant’s actual cost of accepting credit cards and may not exceed 3% of the total transaction amount.
Card-network rules cap credit card surcharges at 3%, meaning that if a merchant’s processing costs exceed this amount, the excess portion cannot be passed on to the patient.
Network and State Restrictions
The major credit card networks, such as Visa and Mastercard, impose specific requirements related to surcharge limits, advance notification, and disclosure.
In addition, several U.S. states and territories regulate or prohibit credit card surcharging. At the time of writing, credit card surcharging is prohibited in Connecticut, Maine, Massachusetts, and Puerto Rico. Other states, including Colorado, Minnesota, Mississippi, New Jersey, and New York, impose restrictions on surcharge amounts or require specific disclosures.
If your practice operates in a state that restricts or prohibits credit card surcharging, you must fully understand and comply with those requirements before implementing a surcharge.
Debit card transactions may never be surcharged, even if the debit card is processed as a credit transaction.
Applicability
Credit card surcharges may be applied only to credit card transactions. Other payment types, including debit cards and alternative payment methods, are not eligible for surcharging.
Regulatory Compliance
Merchants are responsible for maintaining ongoing compliance with all applicable card-network and legal requirements. This includes meeting advance notification obligations, using compliant signage and disclosures, adhering to surcharge percentage limits, and respecting jurisdiction-specific restrictions.
By following these guidelines, dental practices can implement credit card surcharging in a way that aligns with card-network rules and promotes transparency with patients. Clear and upfront communication helps maintain patient trust and supports a positive payment experience.