How Can I a Create Credit/Debit Card Fee?

[100foxhall]

The title of this thread has been edited by a Square Moderator from the original: "I have the Square Register system .. "Credit/Debit Card" transaction Fees"

I have a Square Register System .. Can anyone tell me how to apply a "Credit/debit card fee" to customer transactions and have it show up on the receipt?  I was told my "register solution" is not capable I needed the Tablet solution ...

[Donnie-M · Accepted solution]

@100foxhall Technically it doesn't matter what system you have.  Charging the transaction fee back to the customer is a "slippery slope" issue.  In some states it is actually illegal to charge a credit card processing fee or convenience fee back to the customer (Colorado, Connecticut, Kansas, Maine and Massachusetts).  That doesn't mean people don't try and do that though.  

I would price the cost of doing business with credit card fees into the pricing on your items.  The only way to more legally get around it is to offer some sort of cash discount.  A lot of the cost of transactions depends on the average sale amount.  A 10$ transaction with a .10 + 2.6% is a greater percentage than a 100$ with .10 + 2.6%.  As a general rule, it is probably less than 5% of all of your credit card transactions to process the transactions.  Since the point of sale software and many of squares products have free versions, I look at part of this fee is to cover my point of sale system.

You can have service charges, but if you go that route, you would have to charge it on every transaction.

I know this might not be the exact answer you are looking for, but I would put yourself on the other side of the terminal and ask how it would be if you had to pay that every business you shopped?  Credit card processing fees are just an overhead expense you can avoid with cash or checks..but then you gotta run to the bank too...

[CHUCKSTRAINS]

Its legal to charge them in NC

[rtfulk]

If you go to your Account& Settings, then click on Business. You will see a tab for Service Charge.  That is where we put our Credit Card Transaction Fee service charge at. When you do there will be a blue key show up your favorites on your POS. When we have a charge we just tap the key and it adds 3% to the amount. It also makes a separate line enter on the receipt that state it was a credit card service fee. We also have a sign at to chip reader explaining the fee and the charge.  One other thing, I think you have to be running iOS 13.0 or higher and the fastest Square POS for the button to show up.

[sunsetoverlook]

Problem is - you can't do it in Square for Restaurants.  I've been waiting for this is be fixed for a year now and will unfortunately be leaving square due to it.  

[Donnie-M]

@sunsetoverlook Just set up a second tax amount and call it service charge and set your percentage.  Name the tax "Service Charge" and you can even tie it to a specific dining option if you want to only charge it in certain situations.  This will work on any of the apps and is the "Original workaround" for service charges.  You can always turn the "tax" off, but that is what a tax is anyway.

Tax has multiple definitions: i.e. "You tax my patients" but you are the person of authority and are requiring the customer to pay this to you.  Semantics aside, you can solve this problem easily, I just don't like credit card surcharges, but I wouldn't want you to leave square and see the grass isn't greener.

[PerkyCup]

So with Square we have to manually add this item to each transaction?  I have employees and this is one more thing I have to trust they will do each time a credit card is used.  Other POS supposedly have this "built-in" and your lower prices are advertised as "cash discount".  Is Square not up to par on this?  I have used Square for 4 years and paid over $40,000 in merch fees, I am looking to stop the hemorrhaging but would like to not have to change my entire POS.

[Candlestore]

@PerkyCup ;

At 4 years with Square and $40,000 in fees would be $10,000 average charge per year with Square.  Even at $500,000 in Credit card Sales and a 2% rate would be $10,000 a year in Credit Card Fees.   Have you called your Square Representative to see about Lowering your processing Rate?   I know once your over $250,000 you can call to negotiate your processing Fee.  Square would have to have a button before CHARGE to ask if it was a Cash or Credit Card Sale.  The only other issue I have is if it is a Split Tender payment of Cash and CC on how to apply the fee to only the CC portion or the Discount to only the Cash portion.  I looked into a Clover POS system, because I was offered FREE processing.  This was just a Cash Discount system and then I needed to buy my POS from that Vendor and pay $5000 per POS station. Currently 2 but may add 2 more.  Plus the added issue of learning a new POS, transferring all my inventory etc.  Did you ever try out one of the other Systems that can reduce your processing Costs?  Was it as easy as they say?  I have 3 or 4 contracts from different POS providers who wanted me to sign up with them but after reading their contracts and the fees for early termination and other fees for their POS systems it is way better in my circumstance to stay with Square. 

[Candlestore]

Another way to do it by not charging a Credit Card Processing fee is to give a 3% Cash Discount.  Technically it only charges customers with Credit Cards 3% more which is illegal in some areas but giving a Discount is ok.  This again depends on the area your in.  You just need signs up that says you give a Cash discount of X%  Doing it this way Square does offer you discounts that can be applied to a sale.  This is the way some Credit Card processors tell you to do it to put the fees back on the Credit Card users without effecting the cash sales.

[PerkyCup]

Please advise how you set this up?

[Candlestore]

Raise ALL your prices by 5% for example across the board.   Then if a Customer pays by cash you already have a Cash Discount button and you Apply that like any other Discount you have.  You must have Signs near your Registers stating you give a Cash Discount of the Percent you have. Then when a customer pays in Cash, I scan all Items on my Square Stand, see they paying in Cash then press the Green Discounts Button then from that window I press my Cash Discount Button.   It applies the % Discount to the entire Cart.  Now you do need to check with your local laws and ordnances to see if you can give a Cash Discount compared to people paying with a Credit Card.  Some places do not allow that, and some do as long as the consumer is notified with Visible signs at the Store by the registers.  I have not actually implemented it yet but have tested this way of only charging CC customers the fee.  I decided since I had to raise prices across the board anyway, I just write Squares fees up as a Cost of doing Business.  Yes the Employees must remember to add the Discount.  I have been contacted by other CC processing companies who SAY they can implement this and then I see their other fees for example, an entire new POS for $5000, times 2-4 is $10,000 to $40,000.  I have 2 Square Stands now at about $1400 all in.  2 Stands, 1 cash Drawer and 1 Receipt Printer.   The cost to switch is not worth it to me.   And if you do over $250,000 a year in CC sales you can ask for better Square Rates.

[rtfulk]

@Candlestore That is correct on the legal issues. We work Fairs in Florida and Texas and it is illegal to charge a credit card fee.  Everything I have read states that you have to have a sign in visible sight if you charge a fee.

[Candlestore]

@rtfulk ;

 What I was told by a lawyer was it is illegal to charge a fee, but giving a discount for what ever reason is legal.  As long as people know of the discount.  So if you need to sell your items at $10 without fees,  Mark the item for sale for $10.30.  The when people see sign and ask, do we get a cash discount.... you say yes and take 3% off which brings their price back to the $10.   But when someone uses a CC they just do not get the Cash discount so they pay $10.30.  As far as I know this makes it legal for charging the customer the fee.  Which makes no sense to me because its just in the wording on how you charge more to people using a CC than a Cash sale.  Just put a sign up advertising a CASH DISCOUNT, sounds better than saying we are Charging a FEE for using CC's.     

[Rakhela]

As other had said it depends on where you are state-wise, some state makes it illegal for us to charge a convenience fee, but if you want to go that route you will have to charge it to all your customer equally and publish it so any customer will see the sign, 

Also, you need to consider if you are selling $5 or $10 dollar items or providing a service for $100 to $500 like cleaning or bookkeeping, it is much easy to charge a convenience fee as a service provider than a sale unit like donuts or coffee.

[PerkyCup]

This has gotten to be a VERY expensive issue.  I have called support and am unable to get acceptable assistance.  I am deeply embedded with Square, as I imagine others are.  I need Square to offer a solution or I will be taking my services elsewhere.