Credit card processing fees can accumulate quickly and are often one of a dealership’s most significant but overlooked expenses. However, with more buyers becoming cashless and opting for the convenience of credit card payments, what steps can dealers take to ease the burden? In today’s episode of Driving Solutions, Amberly Allen, the founder and managing partner of Dealer Merchant Services (DMS), joins us to share how her company helps auto dealers save millions on credit card processing fees without disrupting CSI.
Recently, new legislation has allowed dealers to pass on credit card processing fees to their customers in a surcharging process. However, the surcharge can’t be charged if a customer pays with cash, check, or debit. Surcharging is legal in all U.S. states except Massachusetts, Connecticut, and Maine. Several states, such as Colorado, New York, and California, have specific regulations that businesses must follow.
While implementing a compliance surcharging program may seem a relatively straightforward solution, it’s a tricky situation with some complexities regarding compliance and legalities. In addition–as dealership teams have probably already experienced first-hand–it has the potential to upset some customers.
The key to avoiding customer service issues is effectively communicating with them. Communicate both prices, the cost with a surcharge and the cost with a cash discount, to the customer upfront and often. It gives them the power of knowledge and choice and will protect the dealership’s CSI score.
DMS will provide dealership staff with in-depth, comprehensive surcharge education so that staff members can confidently navigate the process. In addition, DMS also uses patent-backed software for card readers that autonomously navigates the complexities and nuances surrounding surcharge compliance. These advanced card readers can differentiate between credit and debit cards to ensure compliance with the law.
DMS differs from other merchant providers because their business and focus are tailored solely to the automotive industry. Unlike other merchants, they have a deep understanding of the automotive industry and the inner workings of a dealership to help clients build a stronger business.
Taking control of credit card processing fees isn’t just about saving money. It’s a practical and strategic way to reclaim capital to invest in the business for continued success and growth.
"We want to make sure dealers are doing this the right way as this initiative is complex".. It's important to find a merchant that understands the complexity of automotive." Amberly Allen
