Federal definition to keep in view
15 U.S.C. 1693o-2 defines a lawful discount as a reduction from the regular posted price. It does not define discount as adding price after the regular price is shown.
Program comparison
Cash discount and surcharge are not interchangeable labels.
A merchant can use either model, but each model has different display, disclosure, and transaction controls.
| Program | Pricing display | Card-brand focus | Operational risk |
|---|---|---|---|
| Cash discount | Regular displayed price is the card price, or card and cash are shown side-by-side. Cash payer receives a reduction. | Must not be structured as adding a card fee to a lower posted regular price. | Risk rises when implementation is mislabeled or posted prices are inverted. |
| Surcharge | Fee is added to credit card transactions and disclosed at entry, POS, and on receipt. | Credit-only, capped by cost-of-acceptance logic and network framework, with advance notice obligations. | High if notice, debit controls, signage, or receipt logic are incomplete. |
| Dual display pricing | Card and cash prices are both displayed to the buyer before payment. | Still requires accurate POS behavior and clear customer-facing presentation. | Medium when labels and system math remain synchronized over time. |
Visa framing for cash discount setup
Visa states a merchant offering a discount should present item pricing either as card price only, or as card and cash prices side-by-side. Final card total should reflect displayed card pricing, not a fee added at payment time.