wow! fees for paying by card are getting out of control.
1.65% for any card, credit, debit, eftpos, at the fruit and veg.
1% for a takeaway burger, or at a ramen place.
these types of surcharges used to be only on expensive credit cards, amex in particular, now even eftpos.
at aldi you can avoid the 0.5% fee by paying with eftpos.
contactless payments, apple pay, google pay, are great and all, but not for 1+%
I walked over to the ATM, and now I have reverted to cash.
I’m going to assume all these places you mention (apart from Aldi) are small businesses? As long as it’s signposted, it’s fine with me. What isn’t fine is JB Hi-Fi charging 2.65% for Amex. Luckily they stopped that about a year ago.
Pretty sure the Broadway Sydney carpark still charges 3% if you pay by credit card
What I don’t get is that on a loaf of bread, it’s 4¢ extra to use contactless. But if I go in and let’s say, buy $10,000 worth of new house appliances, paying with the same credit card, all of a sudden it costs $100 to do exactly the same thing. You can’t tell me that it takes $99.96 more effort to pay the larger transaction.
The banks charge a percentage on credit/tap and a fixed fee for eftpos.
I don't understand why, when eftpos is now 70-80% of transactions these businesses haven't just factored it into the price!
Pay less, pay cash.
Not all banks; by default Westpac, CBA and Square (and probably more now) charge between 1.1%-1.9% for eftpos transactions.
Not for me on CBA, fixed fee for eftpos.
Just had a look at and it looks like those plans may be disappearing, only a matter of time before a forced change probably.
What I don’t get
That is how % based fees work! Credit card companies charge a % based fee on the total amount regardless of the price.
Heck use apple pay? Even apple is skimming a % fee of the top as well for each and every transaction that is paid via apple pay.
Do you know what that fee is? It's between half a cent to one cent, from memory. That your bank is charged, not the customer or shop.
Skimming a %? Entirely incorrect.
Do you know what that fee is?
Its tiny, but its still a 'fee' Apple tack on to the transaction because they can, nothing more, nothing less.
https://www.savings.com.au/credit-cards/how-much-do-australi…
Skimming a %? Entirely incorrect.
Apple are charging the banks a % fee in Australia for allowing the transaction to happen on the device. Its skimming money of the top in my books for no other reason than they can.
Google for example doesn't skim money from the transaction in the form of a % fee per transaction like Apple is doing.
@JimmyF: Ah my mistake. But I mean, c'mon:
Allegedly, Australian institutions are paying between four and six basis points (0.04% – 0.06%)
That's f all compared to the % OP is talking about
That is how % based fees work!
I'm not an idiot. I know how "% fees" work. What I am asking is how is it justified that the two transaction are the same, yet they deem that a $10,000 transaction requires almost $100 more worth of "fees" to transact. It's just moving data around
There should be a % or fixed fee, whatever is the lesser. ie: 1% or $5. It cant cost $99.96 more to process one payment over the other. A $10 payment does not have any more overheads than a $1,000 payment.
The ones I like are the places that will only accept card payments and then put a fee on top of it. Then I have to remind them that they have to at least supply one alternative that is fee free.
Why does the interest on a $100k mortgage cost more than a $1 million one.. same thing. It's not just the actual transaction costs. What the fees cover:
You really think the bank is going to charge the merchant $5 to give you 10,000 QFF points on that $10,000 transaction ?
If it turns out fraud was involved, Visa could be on the hook for $10,000, instead of $2 in the case of your loaf of bread.
Which makes me curious how fees are handled in the case of debit transactions, or where the spender can be on the hook for any such risks
1% not too bad for a convenience tax.
Plenty of other options,take your business elsewhere….
Agreed. I almost want this surcharges to be banned altogether. What started as a reasonable understanding becomes a cash cow.
Just as people can say it is a convenience tax, it is also a convenience for the merchant too.
They don't really have to count coins/notes, reduced reconciliation effort, and most of all, eliminated the security risk (ie: robbed while banking) and as far as I know, paypass transactions are less likely to be chargebacked for most of these eateries places.
As usual RBA is effing useless in policing this. Bring back Ian MacFarlane! His successors are all useless especially his next successor.
What started as a reasonable understanding becomes a cash cow.
Cash cow? You do know the retailer gets charged a % based fee on each credit transaction, they also have to rent the machine too. It's hardly 'free' for them or a cash cow once all this is factored in.
They don't really have to count coins/notes, reduced reconciliation effort, and most of all, eliminated the security risk (ie: robbed while banking) and as far as I know, paypass transactions are less likely to be chargebacked for most of these eateries places.
I agree it removed all the cash handling issues indeed, but is that worth 1-1.5% of your turnover though? If I turn over $500k/yr, is it worth spending $5-8k in credit card fees to the banks aka credit card companies? For some yes, for some no. For those that play the hidden tax game from the ATO, its a hard no :)
I upvoted your comment.
However if I were to say dont offer the cc options at all and see if you will get the same volume.
There has to be a give and take in all this.
1.65% is almost straight pass through when there is a benefit to for the merchant. Vicroads charge less than 1% or like 0.5% or something.
We started with 1% and I thought thats reasonable but now we have effing 3% for Wilson Car Park and 1.5% to 2% for most eateries that charge surcharge.
RBA said reasonable is I think from memory 1.4% and eateries charge 1.5%.
If they feel they can live without cc, then I dare them to do cash only.
And see if they can have the same volume.
1.65% is almost straight pass through when there is a benefit to for the merchant. Vicroads charge less than 1% or like 0.5% or something.
This is 3/4 of the issue, the % rate isn't the same for each business and basically comes down to what the bank thinks your business 'risk' profile is and the volume of transactions you'll do etc to what deal they will offer you. So Vicroads should get a better deal for sure than a mum and dad takeaway store in the burbs and this is reflected in the charges you're seeing. But should it be this way?
We started with 1% and I thought thats reasonable but now we have effing 3% for Wilson Car Park and 1.5% to 2% for most eateries that charge surcharge.
I agree, large high volume places like Wilson parking shouldn't be anywhere near 3%. So report them if you think its over the top. I myself question anything over 1.5%, in the OP example a small fruit/veg store charing 1.65% is a little high, but certainly no money maker for them. They are just trying to cover the terminal rentals etc
RBA said reasonable is I think from memory 1.4% and eateries charge 1.5%.
When the ACCC allowed retails to pass on the fees, it was to make the banks more 'honest' by exposing the crazy prices some had been charging and to a point it has worked by lowering fees down. But it is still not the best.
The real question is why are all these fees even there and why isn't there a 'fee free' tap and pay system.
Why do you get to decide what gets banned or not? A business should have the right to wear the cost or pass it on. And it’s great for consumer choice, if a business does not see a impost in counting cash and going to the bank it’s their choice.
Its not a choice if everyone does it. Its cartel.
2 years ago, only 2 vendors in a food court I go to charges Surcharges now only KFC and Schnitz dont charge them.
Last year some of these eateries didnt accept cash and they force you to use cc and they charged surcharges on it.
It is out of control.
Its not a choice if everyone does it. Its cartel.
umm, you can always pay cash. Therefore it's never a cartel. Do you even know what a cartel is?
Last year some of these eateries didnt accept cash and they force you to use cc and they charged surcharges on it.
don't go to the some (what 1 in 20) that doesn't accept cash.
Last year some of these eateries didnt accept cash and they force you to use cc and they charged surcharges on it.
Thats my pet peeve…. Don't accept cash, but have a forced credit card surcharge!!
I reported one of the big hire car companies a few years back for this. Not accepting cash on pickup (was happy for them to put a hold on my CC for insurance etc), then forcing a surcharges on the only payment they accepted aka credit card. Funny enough the ACCC said this was 'ok' for them to not accept cash and it was 'legal' to apply a credit card surcharge too.
If you don't accept cash and only accept card and then force a surcharge on top of that, then the fee should be built into the price. Simple as that.
becomes a cash cow
Didn't they enact laws specifically surrounding this a few years ago? Previous employer charged a flat 2% and had to change their system because of it.
If I remember correctly, a 1% fee is allowed, but any higher and you need to be able to prove that your transaction fees are equal to those surcharges. Proof to.. Uhh.. Someone? The ACCC I suppose.
This was specifically brought in because of places charging 5%+ fees for credit charges for coffees, etc.
don't really have to count coins/notes
Until all cash is gone, daily counts still need to take place of all cash. This is to prevent theft from both staff and customers.
paypass transactions are less likely to be chargebacked
This hasn't been my experience in technology retail. When someone pays with a pin, it's (probably) their card. When someone pays without a pin (As are the cases for most paypass transactions) it's easier for them to claim the card was stolen and it wasn't them, thus chargebacks occurred more often in my experience.
For the last handful of years I've not worked at a place that has these surcharges, but if they were banned altogether then costs would rise as a direct result, likely more than the 1-3% the surcharges are, and it will be across all transactions cash or otherwise.
In my mind, it feels like the lesser of two evils.
Da inflation is 🏃 ☝️. Who can 👫 blame ❓
On the flip side, I hate businesses which only accept cash or those which require a minimum spend before they accept cards.
Use a debit card. Or cypto card that makes 2 percent. Or HSBC
lol, are you referring to the crypto.com card? The one where you need to dump shitloads of money into their speculative specific crypto to be eligible? "Makes 2%…" more like "takes you for a ride"
Well it's one percent for the free range.
And it's five hundred dollars staked for the two percent plus return in cro coin for Spotify.
Yes it's risky. As cro coin could end up being valueless but if i break even it's cool
A 💩 load of coins is worth it.
People are buying luxury handbags and Range Rovers while getting 8% cashback.
Lmao. $500k in CRO to get 8% back. You're right, if you're going to spend over $6.25m on your credit card it might be worth it.
@rektrading: Cool! Only got to spend $25k to get my $500 'stake' in value. All while using an extremely painful and annoying 'pre-load' system where I have to wait for funds to clear before I can use it. Sounds great!
@bobswinkle: Not to mention that most points based cards provide between 1-2% of value in points anyway…
@bobswinkle: Points cards require fiat money and a bank account.
I know people that don't have bank accounts, get paid in #bitcoin and live solely on crypto.
They have the higher tier cards and enjoy cashback on purchases. They convert the cashback to #bitcoin and/or buy crypto gift cards to pay for living expenses.
@bobswinkle: It has nothing to do with being brave.
Crypto.com has been in business since 2016 and has over 10M users. They keep growing bigger every year like their competitors and are slowly taking away business from legacy banking.
Use a debit card.
i'll try again
"1.65% for any card, credit, debit, eftpos".
I hate how places charge a “booking fee” or something like that. Like Hoyts, charges $1.50 (PER TICKET) to book online
Small business prefers cash, especially if it’s a takeaway, car wash or fruit shop, they highlight the card fee at the register as a way to get you to pay cash. It’s not about bank percentages on cards it’s about tax.
Why don't they just put a permanent "Cash Only, EFTPOS broken today" sign up? I see it a few times. 😂
My local Chinese takeaway is thoughtful enough to have installed an ATM next to the register, so there's a $2 withdrawal fee and they still get to avoid tax. Great sizzling Mongolian beef though 😂
I've seen eftpos broken signs that look like they're a few years old.
Apple Pay allows you to switch to Savings/Eftpos on debit cards
Until you come across some merchants that charge the same surcharge for eftpos as Visa/Mastercard/Amex anyway (eg, Square)
Isn’t there no % charge to merchants for eftpos transactions? Making that illegal?
No? Nobody has said where it's illegal?
Wait till they start fuel surcharge
And this will go into Ubers pocket and not to the drivers that need it. Drivers will see pennies on the dollar from these "surcharges". The rest will go to paying the Uber arsehole CEO's yacht repayments.
You can guarantee that the "temporary" surcharge will magically translate to permanently higher prices.
1.65% for any card, credit, debit, eftpos, at the fruit and veg.
Charging a % fee on eftpos is illegal, as that is a fixed based fee to the retailer. All the others are % based fees and 1.65% while on the bit higher side of things is still acceptable for a passthrough fee.
You can always drop by the ATM and grab cash out before your shopping trips.
The code does permit a fee for eftpos when their merchant agreement has a higher fee for lower value transactions.
This is why some places set a minimum for eftpos or charge more for using it under a set amount.
but yes a % fee is a no no
i think it has to be a fixed amount, most of the time i see 50c fee if under $10 etc
Correct, based on the code, a % fee on EFTPOS (Chq/Sav) transactions is illegal as it doesn't reflect the costs paid by the business to accept that payment. A flat fee cost does, so is allowed but most just wave it.
Where is it illegal?
Merchants can only pass on what it costs them to accept the card. If it costs them 1.2% for eftpos, then they can surcharge 1.2% for eftpos. https://www.accc.gov.au/consumers/prices-surcharges-receipts…
Westpac do 1.2% for eftpos, Visa, Mastercard and UnionPay
https://www.westpac.com.au/business-banking/merchants-and-pa…
Square charge 1.6% - 1.9% (depending on the terminal) for Amex, JCB, eftpos, Visa and Mastercard
https://squareup.com/help/au/en/article/5068-what-are-square…
CommBank are doing 1.1% for Amex, JCB, eftpos, UnionPay, Visa and Mastercard
https://www.commbank.com.au/business/merchant-services/eftpo…
What code is this?
Nowhere does it say it has to be a fixed amount for eftpos instead of a percentage fee.
Merchants can only pass on what it costs them to accept the card. If it costs them 1.2% for eftpos, then they can surcharge 1.2% for eftpos. https://www.accc.gov.au/consumers/prices-surcharges-receipts…
Westpac do 1.2% for eftpos, Visa, Mastercard and UnionPay
https://www.westpac.com.au/business-banking/merchants-and-pa…
Square charge 1.6% - 1.9% (depending on the terminal) for Amex, JCB, eftpos, Visa and Mastercard
https://squareup.com/help/au/en/article/5068-what-are-square…
CommBank are doing 1.1% for Amex, JCB, eftpos, UnionPay, Visa and Mastercard
https://www.commbank.com.au/business/merchant-services/eftpo…
Not illegal. They can pass on what they're being charged. Not every payment processor has flat fees for eftpos.
A local takeaway shop gives a 5% discount for cash. This makes it a 5.26% surcharge for card.
How much spare change have you got lying around in your home or gets lost
That doesn't seem like a great way to do things as now the prices when paying by cash will have random cents at the end and you won't have a nice round figure that is easy to give change for
Banks are moving towards a new system which will treat Debit Card Visa/MC transactions as EFTPOS when tapped
Its already in place in some larger retailers , this means the merchant is charged as an EFTPOS transaction when you tapp a debit card linked to a transaction account
The transaction will also be instantly processed on your account like an EFT one is when you select Savings and enter PIN.
This should in the long run reduce the instances of "card fees" especially at places that do not charge them for Eftpos transactions.
This.
It's called Least Cost Routing or Merchant-choice routing, and is enabled on most merchant facilities nowadays.
Edit: Keeping on topic, this should mean a lower cost in the long run.
For merchants using Tyro or SmartPay (which add the card acceptance fee once the card has been tapped/inserted), I would assume that this reflects the lower cost of EFTPOS over Visa/MC if it does got through least cost routing
Not that simple. Macquarie etc have just gone pure Mastercard only, with no eftpos - so your only option is Mastercard - can't opt for SAV.
And banks are moving away from LCR to flat % for all card types instead anyway.
Westpac do 1.2% for eftpos, Visa, Mastercard and UnionPay
https://www.westpac.com.au/business-banking/merchants-and-pa…
Square charge 1.6% - 1.9% (depending on the terminal) for Amex, JCB, eftpos, Visa and Mastercard
https://squareup.com/help/au/en/article/5068-what-are-square…
CommBank are doing 1.1% for Amex, JCB, eftpos, UnionPay, Visa and Mastercard
https://www.commbank.com.au/business/merchant-services/eftpo…
Agree. I've said for years this should just be factored into the overall price.
Frankly, it's a greater slap in the face to buy a quick takeaway (or whatever) for $8.20 and then see the price "magically" change to $8.33 than it is to just be charged $8.40 to begin with.
That's why you need to make your card work for you. Though doesn't work for everyone especially if you can't/won't make use of upgraded flights (or don't think they're worth it), or don't spend enough.
For many years now I've managed to limit most of my Amex purchases to using the Paypal filter which has no surcharge. Of course this doesn't work when using POS but I use it even more now that they've improved the reward points recognition when not using the card number directly.
As long as the business as a Cash option thats fine.
They can charge fees but there should always be a fee free option.
These fees should be the cost of doing business and included in the price of the stuff you buy. It's like fast food places that charge extra on public holidays, I think instead they should just factor in the price of holiday worker rates into the regular menu prices spread across the whole year.
The worst is the online booking charge at Village Cinemas!
Agreed