The short answer
A surcharge adds a fee to the card price at checkout. A cash discount posts the card price and discounts for cash. Dual pricing displays both prices together as the posted price. Dual pricing generally holds up best because it is a pricing decision rather than a fee.
Where each fits
Surcharge suits states permitting it with clear disclosure. Cash discount suits prohibited states, provided the posted price truly is the card price. Dual pricing works nearly everywhere and reads best to customers.
The common failure
Programs sold as 'cash discount' that actually add a line at checkout are surcharges wearing a different name — and they are non-compliant in states where surcharging is prohibited.
Key takeaways
- Dual pricing is the most portable structure
- A cash discount must start from the card price
- Mislabelled programs are the most common violation
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