Why This Matters

Running a gym or studio means balancing rent, payroll, equipment, software, and everything else it takes to serve your community. On top of that, payment processing fees quietly chip away at your margins every single month.

Wodify’s Passing On Processing Fees feature lets you shift credit card or ACH processing fees to your clients instead of absorbing them yourself. For many gyms, this can add up to thousands of dollars in savings every year.

Those savings can be reinvested into:

• Better equipment and facility upgrades

• Hiring and retaining great coaches

• More classes, events, and member perks

Instead of raising membership rates across the board, you get a transparent, automated way to share the cost of convenience with the clients who choose to pay by card or ACH, while keeping your base pricing consistent and predictable.

To help you communicate the change, we’ve included a ready-to-use communication template you can customize to:

• Explain the processing fee clearly and tactfully

• Emphasize the value your business continues to provide

• Reassure clients that this change helps keep your gym strong and sustainable

If you’re unsure whether passing on processing fees is the right move for your business, we encourage you to book a call with our Account Management team. We’ll walk you through the numbers, discuss how much you could save annually, and help you decide what makes the most sense for your clients and your long-term goals.

Pre-requisite Pro-Tips

• Consult legal counsel: Check with financial experts that are familiar with the regulations in your jurisdiction. 
• No cash/check when passing on fees: When you use Passing On Processing Fees, you should not accept cash or check as a method of payment for your business, as it may be considered a violation of major card brand rules and can result in fines starting at $1,000. See the FAQs below for more details.
• Name the fee clearly: The fee can be labeled however you choose (for example: “Service Fee”, “Community Fee”, or “Admin Fee”), as long as it is clear and transparent for your clients.
• Communicate proactively: Feel free to use the provided communication template in this article to announce the change and focus on how this helps keep your gym strong and able to continue investing in your members.
• Think about the member experience: Announce the change in advance with a clear effective date and make sure your staff understands the “why” so they can confidently answer questions.

Step-By-Step How To

• Enabling Passing on Processing Fees for your location
• Toggling Passing on Processing Fees for individual invoices
• Toggling Passing on Processing Fees for individual memberships
• Toggling Passing on Processing Fees for Simple Sign-in Drop-ins
• Toggling Passing on Processing Fees for Point-of-Sale
• See How much you saved on Processing fees
• Frequently Asked Questions

How to Enable Passing on Processing Fees

Check out the steps below to set up Passing on Processing Fees (it takes less than a minute)!

How to Toggle Passing on Processing Fees ON/OFF in Individual Invoices

You may want to toggle to pass on or absorb the processing fee for specific invoices. Now all applicable invoices will have a dropdown that allows you to choose either Passing on or Absorbing.

How to Toggle Passing on Processing Fees ON/OFF in Individual Memberships

You may also want to toggle to pass on or absorb the processing fee for specific recurring memberships. When you toggle the fee option to Passing On, all auto-renewing membership detail screens will have a dropdown that allows you to choose either Passing on or Absorbing for the processing fee section.

How to Toggle Passing on Processing Fees ON/OFF for Simple Sign-in Drop-ins

You may also want to toggle to pass on or absorb the processing fee for a Drop-in payment. Clicking on the pencil Icon or Edit will allow you to sign in as an Admin to Edit the Drop-in amount and to choose either Passing on or Absorbing for the processing fee section.

How to Toggle Passing on Processing Fees ON/OFF for Point of Sale

You can also toggle to pass on or absorb the processing fee for retail purchases in Point of Sale. In the Admin interface, you can now choose either Passing on or Absorbing for the applicable processing fee section. This option will not be available for the self-service tab.

See How Much You Saved on Processing Fees

You can now see how much fees you have saved by passing on your processing fees to your clients.  Here are some of the places to see all the fees saved:

1. Financial > Payouts
2. Financial > Transactions
3. Analytics > Reports > Financial > All Invoices
4. Analytics > Reports > Financial > Payouts 

FAQs

Q: Can I turn on this feature for new clients only? Yes! When you enable this feature, you'll be prompted to either turn this on for ALL existing memberships/invoices or only new memberships moving forward.

Q: If I accept cash or check when passing on processing fees, what are the potential fines Accepting cash or check while using Passing On Processing Fees (or a similar fee structure) will likely be treated as a violation of major credit card company rules, including Visa and Mastercard’s surcharging policies. If a violation is identified, the card brands can assess non-compliance fees starting around $1,000.

Q: When a refund occurs, does the processing fee also get refunded? Yes, but you can do a partial refund on the paid invoice's line items by refunding just the item.

Q: Why can’t I recalculate the transaction fees on the invoice? We completely understand this question. The answer is that passing on the processing fee increases the amount of the initial invoice, which in turn, increases both the cost of processing that invoice and any associated sales taxes.

Let’s take a simplified example: If a customer is charged $100 and the fee rate is 5%. Many folks would expect to see a total invoice of $105. The problem that arises is that the fees associated with a $105 charge are more than a $100 charge. So the system estimates how much the fees will be prior to calculating the amount of fees to charge and pass along. So, on a $100 invoice, the system estimates $5 in fees and calculates the fee as 5% of $105 or $5.25. From there, the final invoice is the $100 plus the $5.25 or $105.25. (There is a circular logic issue here whereby the $105.25 charge costs more to process than the estimated charge of $105, but we stop the calculation at one iteration to not overcomplicate an already complicated calculation.)

For those of us who love to dive into the details, we have also created a handy calculator that you can download here (make a copy) to recalculate any invoices or run any test scenarios that you want.

If you need any additional assistance with setting up the passing on processing fee function, feel free to reach out to us at support@wodify.com or via Priority Live Chat in your admin account.