More businesses are now placing surcharges on all card payments, while they were previously only common on credit cards.
More small businesses are adding surcharges of between 1 and 1.5 per cent to debit card payments, in what the retail industry says is a survival response to rising costs in the sector.
As a guide for what counts as “excessive”, the ACCC uses the Reserve Bank of Australia’s estimated costs for different payment types: eftpos , Visa and Mastercard debit cards and Visa and Mastercard credit cards . “Individual transaction surcharges may be small, but they add up significantly for a retail business particularly those with high-volume transactions.”
In this situation, the ACCC advises businesses should charge the lowest processing cost. But sometimes the business’s payment provider charges a flat fee for debit and credit cards, and, regardless, keeping track of several different payment costs can be cumbersome: this masthead found virtually no universal surcharges at small businesses were within the 0.5 per cent to 1 per cent processing cost for debit cards, estimated by the RBA.
Earlier this month, management of the privately owned Hamilton Island announced it would no longer take cash payments at its outlets.
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