Is participation in the Del Taco gift card program required for franchisees?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
sive income | — — | — — 595 — 595 | | Balance at January 19, 2025 | 82,971 $ 829 $ 537,568 | $ 1,891,977 $ (56,880) $ (3,200,625) $ (827,131) |
RECITALS
Del Taco operates franchises and licenses Del Taco restaurants that feature Mexican-American and American dishes. Del Taco and Franchisee have entered into or propose to enter into one or more Franchise Agreements (each a Franchise Agreement" and, collectively, the "Franchise Agreements"); and
Del Taco and Banc of America Merchant Services ("BAMS") have entered into that certain Premium Gift Card Processing Agreement (the "Processing Agreement") dated January 5, 2018, pursuant to which BAMS shall provide services in connection with Del Taco's gift card program; and
Del Taco requires that Franchisee participate in Del Taco's gift card program in each of the designated franchised Del Taco Restaurants (the "Licensed Restaurants") listed on appendices to this Agreement.
NOW THEREFORE, in consideration of the mutual covenants, agreements and obligations set forth below, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:
- 1. Term. The term of this Agreement with respect to each Licensed Restaurant shall begin on the Effective Date and shall expire upon the expiration date of the Franchise Agreement (i.e.
Source: Item 23 — RECEIPTS (FDD pages 59–325)
What This Means (2025 FDD)
According to Del Taco's 2025 Franchise Disclosure Document, participation in the Del Taco gift card program is mandatory for franchisees. Specifically, Del Taco requires that franchisees participate in the gift card program for each of their franchised Del Taco restaurants.
As part of this program, franchisees are required to authorize Banc of America Merchant Services (BAMS) to automatically debit their designated bank accounts for amounts due in connection with the gift card program. BAMS acts as a settlement agent, handling the settlement of gift card redemptions between program participants, including Del Taco and its franchisees. This involves BAMS initiating Automated Clearing House (ACH) debits and credits to the franchisee's bank accounts for gift card sales, redemptions, and fees.
Franchisees must sign ACH authorization forms to allow BAMS to manage these transactions. They are also responsible for ensuring their bank accounts are adequately funded to cover ACH settlements and fees. Failure to maintain sufficient funds can result in penalties, including a $20 fee per returned item if an ACH debit is dishonored. Additionally, franchisees will incur monthly processing fees, including transaction fees, an ACH service fee of $0.06 per transaction, and a $5.00 per month location fee.