While reading Payarc's article on the future of in-store payments, one line stood out to me:
By 2026, more merchants will use compliant dual pricing models to offset rising processing fees. With growing consumer familiarity and the regulatory guardrails now well-established, dual pricing offers a sustainable way to manage costs transparently.
That got me thinking. I have not seen much discussion about dual pricing in the context of dealership service departments, but I have seen firsthand what happens when a similar concept is applied in the form of an extra convenience fee for paying by credit card online. For context, ROPayNow includes an option that allows dealerships to present this online convenience fee transparently to the customer when the dealership chooses to enable it.
Dual Pricing in the United States - A Brief Context
In the United States, dual pricing, where one price is shown for cash and another for credit card payments, emerged as a compliant alternative to traditional surcharging.
- Before 2013 —Card network rules and many state laws prohibited merchants from adding credit card surcharges, leaving them to absorb processing costs.
- 2013 —A major antitrust settlement with Visa and Mastercard allowed surcharging in most states, under strict disclosure rules.
- 2017-2021 —Court rulings struck down most state-level bans, making surcharging legal in nearly all states.
- Dual Pricing Gains Favor —Instead of adding a fee at checkout, merchants began posting two prices upfront, a “cash price” and a
credit price
that includes processing costs. This method is compliant nationwide and transparent to consumers.
Government agencies, both local and federal, have long used a similar approach by charging an extra fee for credit card payments while offering a no-fee ACH option. For many consumers, this is an accepted practice when paying taxes, renewing licenses, or handling court-related payments.
Today, rising processing fees and increased consumer awareness are driving more U.S. merchants toward dual pricing, exactly as Payarc predicts for 2026.
What I Have Observed in Dealership Service Departments
In my work with dealerships, I have seen what happens when a service department applies a convenience fee for credit card payments made online through ROPayNow. This was not true dual pricing, because the repair order total was the same whether paid online or in person, but when customers saw the extra fee for paying by credit card online, their payment behavior changed.
When dealerships enabled this option, the payment process itself worked seamlessly:
- The repair order clearly showed the total amount due for the repair order, the credit card convenience fee, and the final total
- Everything was transparent to the customer at the point of payment
- Advisors could easily explain the breakdown if needed
However, many customers chose to avoid paying online once they saw the extra fee. Instead, they returned to the dealership to make their payment in person, often still using a credit card since there was no additional fee for in-person transactions.
Luxury vs. Mainstream Customer Reactions
Customer responses to the online credit card convenience fee varied by dealership segment. In luxury dealerships, customers often viewed the fee as a small price to pay for the convenience of remote payment, with many already familiar with similar charges in other transactions. In mainstream dealerships, customers were less accepting, often choosing to pay in person to avoid the fee, especially on smaller repair orders. These differences suggest that expectations, perceived value, and sensitivity to added costs can vary significantly between customer segments.
- Luxury Vehicle Customers (Porsche, Audi, BMW, etc.) — Often viewed the fee as a small price to pay for the convenience of remote payment, with many already familiar with similar charges in other transactions.
- Mainstream Vehicle Customers (Honda, Toyota, etc.) — Were less accepting of the fee, often choosing to pay in person to avoid it, especially on smaller repair orders.
This difference highlights that customer sensitivity to added costs is shaped by perceived value, prior experiences with similar fees, and the importance placed on convenience versus cost savings. These are simply observations based on dealership segment and should not be assumed to reflect customer income level, economic status, or purchasing power.
Why This Matters if Dual Pricing Becomes the Norm
If dual pricing takes hold in dealership service departments, the change will not just be about how much customers pay. It will influence how and when they pay. Dealerships may need to:
- Rethink payment strategies to balance cost recovery with convenience
- Equip staff to explain pricing differences without creating friction
- Monitor shifts in payment behavior to avoid slowing down operations
Dual pricing may help recover transaction costs, but it is not without consequences. The challenge will be keeping the payment process transparent and efficient while ensuring customers still choose the most operationally friendly option.
If your dealership is considering dual pricing or already charging online convenience fees, now is the time to evaluate how it impacts customer behavior. Understanding these patterns early can help you adapt policies, train staff effectively, and maintain a positive payment experience.
With ROPayNow, dealerships have the flexibility to configure online payment options, including transparent convenience fees, so they can meet operational goals while keeping customers informed and in control of how they pay. If your dealership's mission and goal is to bring transparency, efficiency, and consistency to operations, and to ensure that every interaction builds trust and strengthens the relationship with customers, this approach can support that vision. If you would like to explore how this could work for your service department, I am happy to share more of what we have learned.
