Cash discounting, or informing customers that items in the store are priced less expensively if purchased with cash, does not have the legal barriers of straight surcharging, which is simply charging more for products to cover card fees.
When offered in a fair and transparent manner, DCC provides real value and benefit to both the cardholder and the merchant striving for new ways to remove friction and improve their customer service experience, writes Mark Horwedel, CEO of the Merchant Advisory Group.
DCC is popular with payment processors and merchants because it almost effortlessly boosts profits, gouging an often one-time consumer instinctively comfortable and receptive to paying in his familiar home currency, writes Eric Grover, a principal at Intrepid Venture.
American Express claims its rules allow it to better compete against other major card networks. The complaining states view anti-card steering rules as a way to block other networks from offering lower fees, thus resulting in retailers raising prices for consumers.
Commercial customers, including small businesses, seem ready to pay up to shift to faster, more sophisticated electronic invoicing and payments, and enterprising banks that provide them the technology to do so could find it lucrative.