Understanding Fees and Charges: A Guide for Australian Business Owners Using EFTPOS

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By Jacob Maslow

Electronic Funds Transfer at Point of Sale (EFTPOS) systems have become a cornerstone of daily business transactions. As a business owner, the ability to offer convenient, quick, and secure payment options is not just a value-added service; it’s an expectation. While EFTPOS systems bring undeniable benefits in efficiency and customer satisfaction, navigating the landscape of associated fees can be complex.

Overview of EFTPOS in Australia

At its core, EFTPOS is a system that allows for the electronic transfer of funds from a customer’s bank account to a merchant’s account upon purchasing goods or services, using a card-based payment system. This technology has become ubiquitous in the Australian financial landscape, widely adopted across various businesses, from supermarkets to small local shops.

EFTPOS entered the Australian market in the 1980s and has seen widespread adoption and continuous evolution. Initially, these systems were somewhat cumbersome and slow, but technological advancements have led to faster, more secure, and more versatile systems. Today’s EFTPOS systems handle basic transactions and offer additional functionalities such as contactless payments, integration with loyalty programs, and real-time reporting features.

Types of EFTPOS Systems

As the demand for efficient and secure payment methods has grown, so has the variety of EFTPOS systems available in the Australian market. Each type of system offers unique features and benefits tailored to different business needs and customer interaction styles:

Countertop EFTPOS Systems: These are the most common types in fixed retail locations. They are ideal for businesses that operate from a single point of sale, like cafes, boutiques, or grocery stores. Countertop systems often offer robust functionality, including integration with point-of-sale (POS) systems, receipt printing, and support for various payment methods, including chip, swipe, and contactless transactions.

  1. Mobile EFTPOS Systems: Perfect for businesses on the go, mobile EFTPOS systems offer flexibility and portability. They are popular among tradespeople, market vendors, and food trucks. These systems use wireless technology (like Wi-Fi or mobile data) to process transactions, allowing payments to be accepted anywhere at any time. They often come with compact designs and long battery life, making them ideal for outdoor or mobile settings.
  2. Integrated EFTPOS Systems: These systems are designed to integrate seamlessly with a business’s existing POS software. This integration allows for streamlined operations, combining sales data and payment processing into one system. They are handy for businesses with complex inventory systems or those requiring detailed sales reporting. Integrated systems can reduce manual data entry and errors, increasing efficiency and accuracy in business operations.
  3. Contactless EFTPOS Systems: These systems have gained significant traction with the rising popularity of contactless payments, especially due to health concerns like the COVID-19 pandemic. They allow customers to make payments by simply tapping their card, smartphone, or smartwatch, offering a quick and hygienic transaction method. Contactless systems are becoming a standard feature in countertops and mobile EFTPOS devices.
  4. Virtual EFTPOS Systems: These are emerging trends especially relevant in the e-commerce and remote services era. Virtual EFTPOS systems enable phone or online transactions without a physical card or terminal. This type is particularly beneficial for businesses that operate remotely or offer delivery services.

How Fees Are Calculated

EFTPOS fees in Australia can vary widely depending on several factors, such as the provider, the type of business, transaction volume, and the specific EFTPOS plan or package chosen by the business.

Depending on your nominated provider and what is required to suit your business needs, rates and fees may differ for every business. Here are some general guidelines:

Merchant Service Fees: These are typically a percentage of each transaction. For debit cards, the fees can be pretty low, often ranging from about 0.5% to 1%. Credit card fees are generally higher, sometimes between 1% and 1.5%, and can be even higher for premium or international credit cards.

Flat Transaction Fees: Some EFTPOS providers charge a flat fee per transaction, anywhere from a few cents to a dollar or more. This is often in addition to the percentage-based merchant service fees.

Monthly Rental Fees: If you’re renting EFTPOS terminals, there might be a monthly rental fee ranging from $20 to $100 or more, depending on the type and number of terminals.

Plan-Based Fees: Some providers offer monthly plans with a fixed fee that includes a certain number of transactions. Exceeding this limit may incur additional fees.

Additional Fees: There could be additional fees for services like installation, setup, and integration with other systems or for premium features like contactless payments.

Minimum Monthly Fees: Some providers require a minimum monthly fee, ensuring they receive a certain amount regardless of your transaction volume.

Chargeback Fees: If a customer disputes a transaction, there might be a chargeback fee, which can vary depending on the provider.

Tips for Reducing EFTPOS Fees

EFTPOS fees are a necessary cost of operations. However, some strategies can be employed to minimize these expenses. Some practical tips for reducing EFTPOS fees include:

  • Negotiate with providers
  • Understand your business needs
  • Compare providers regularly
  • Opt for a simple fee structure
  • Limit international and premium card transactions
  • Use contactless payments wisely
  • Avoid minimum monthly fees
  • Bundle services (such as other banking services)
  • Regularly review statements
  • On-charge fees to customers

It’s worth chatting with a handful of EFTPOS providers to compare plans and work out a custom solution that allows flexibility, low-cost transactions, and reliability.

Making the Most of Your EFTPOS System

Navigating the complexities of EFTPOS fees and choosing the right system for your business can seem daunting. However, with the right information and a strategic approach, finding a solution that fits your current needs and supports your business’s growth is possible. By understanding the various fee structures, comparing providers, and being aware of additional considerations like contract terms and system reliability, you can make an informed decision that balances cost with functionality.

Remember, the goal is not just to reduce fees but to leverage the EFTPOS system as a tool that enhances your business operations, improves customer experience, and contributes to your business’s success. Evaluating your options carefully will ensure that your EFTPOS system is an asset, not a hindrance, to your business’s growth and profitability.


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