Reviewed by Mayer Hyman, Payments Specialist | Reviewed for accuracy July 1, 2026
Key Takeaways
- There are two ways a merchant account can fund your bank account: net daily discount (fees deducted before deposit) or gross daily deposit (full amount deposited, fees billed monthly).
- Net daily discount simplifies monthly expense planning but complicates daily bookkeeping, since deposited amounts never match gross receivables.
- Gross daily deposit simplifies reconciliation and maximizes daily cash flow, but leaves you with a larger lump-sum bill at month’s end.
- Cartis Payments offers both funding methods, so the choice comes down to which one fits your bookkeeping and cash flow needs, not which one your provider forces on you.
When you accept a credit card as payment, the money doesn’t just land in your business bank account as-is. How much reaches you, and when, depends on the funding method your merchant service provider (acquirer) uses.
There are two funding methods: net daily discount and gross daily deposit. If your provider lets you choose one over the other, understanding the difference matters, because it changes your daily cash flow and your bookkeeping workload.
What Is the Net Daily Discount Method?
With the net daily discount method, processing fees are deducted from the day’s receipts before the remainder, the net settled amount, is deposited into your bank account. Say your receipts for the day total $2,000. If processing fees cost $40, your net deposit is $1,960. Fees come out daily rather than in one lump sum at month’s end.
Pros and Cons of Net Daily Discount
The net daily discount method helps with cash flow planning: the month’s processing fees are already deducted as you go, so there’s no separate bill to calculate and pay later. The tradeoff shows up in your books. Because fees are deducted before the deposit hits your account, your bookkeeper has to reconcile daily receivables against amounts that will never match, since fees are baked into the difference. That means extra reconciliation entries every day.
What Is the Gross Daily Deposit Method?
With the gross daily deposit method, the full amount of the day’s receipts, the gross amount, gets deposited with no fee deduction. Using the same $2,000 example, you receive the full $2,000. Processing fees for the entire month are instead deducted from your bank account around the 1st of the following month, based on your monthly merchant statement.
If you’re not currently receiving a monthly statement from your provider, Cartis Payments can send your statements straight to your inbox.
Pros and Cons of Gross Daily Deposit
Gross daily deposit lets you use the entire amount deposited into your account, which maximizes daily cash flow. It also simplifies reconciliation, since you can directly match the amount deposited against the fees charged on your monthly statement instead of untangling daily deductions. The downside: because fees accumulate all month, you can end up with a large bill due at once, and since that bill varies month to month, expense planning gets harder.
Which Funding Method Should You Choose?
There’s no universal right answer here. It depends on how your business handles bookkeeping and cash flow, and a full-service payment processor like Cartis Payments can walk through the tradeoffs with you rather than defaulting you into one method.
As a quick reference:
- Net daily discount fits businesses that want fees accounted for daily and don’t mind extra reconciliation work.
- Gross daily deposit fits businesses that want simpler reconciliation and maximum daily cash on hand, and can absorb a larger month-end bill.
Funding method is one piece of what determines your actual cost of accepting cards. If you also want to understand how interchange-plus pricing affects your processing fees, or whether interchange rates are trending up or down, those two factors combine with your funding method to determine your total cost of accepting cards.
Account Funding Made Easy
Cartis Payments is a payment processing provider, not a bank or a bookkeeping service, and offers both funding methods as part of its processing solutions, so you can choose whichever fits your business rather than being locked into your provider’s default.
Choosing the right funding method can help you maximize cash flow and reduce the operational cost of reconciling your books. If your current provider forces you into daily discount with no alternative, know that options exist.
FAQ
What’s the difference between net deposits and gross deposits?
Net deposits have processing fees deducted before the money hits your account. Gross deposits give you the full receipt amount daily, with fees billed separately at month’s end.
Which funding method is better for cash flow?
Gross daily deposit maximizes daily cash flow since you receive the full amount upfront, but it means a larger bill due at the end of the month.
Which funding method is easier to reconcile?
Gross daily deposit is generally easier to reconcile, since you can match the deposited amount directly against your monthly statement instead of recalculating daily fee deductions.
Can I choose my funding method with any merchant service provider?
Not always. Some providers default merchants into one method. Contact Cartis Payments to find out which funding methods are available for your account.
