Discount Fee Method: Daily vs. Monthly
Introduction
You have two options to choose from in deciding when you want the payment processer to deduct your credit card fees from your account: Monthly or daily discount.
Monthly discount: The processor deducts fees from the account in one lump sum once a month.
Daily discount: The processor deducts fees daily throughout the month as well as at the end of the month.
Both options at the end of the day will deduct the same amount of money (it is not an inherent real discount). What you are deciding is basically how you want to do your accounting.
The following will provide some considerations when choosing your discount fee method.
Monthly Billing
Monthly discount is the standard process of having fees debited from your account at the end of the month. This is considered "gross settlement" because the full amount of the batch is funded. No fees are removed from the daily deposit.
Deposits Do Match the Batch
Daily Billing
Daily discount is an optional process of having fees debited before your daily deposit goes to your account. This is considered "net settlement" because you do not receive the full batch amount. Fees are removed daily before the deposit.
Summary
Monthly Billing |
Daily Billing |
| ✅Deposits do match the batch | ❌Deposits do NOT match the batch |
| ❌Larger debt | ✅No large debt |
| ✅Easier reconciliation | ❌Difficult reconciliation |
| ✅Cash flow |
