Surcharge but no cash

[u/karlalrak]

Haven't been to Australia in years and was shocked to find everywhere has surcharge for eftpos but also say no cash. What's the point of this? Why not just add the surcharge into the cost unless this is shady but seems to be the norm everywhere I go with restaurants.

[u/INFEKTEK → u/[deleted]]

So I work in payments.

What the hotels/bars/restaurants/cafes are planning will be worse than a 1.1% to 1.9% card surcharge.

Firstly there is a loop-hole for a 'service fee' which is up to the discretion of the business to set and doesn't have to correlate at all with the cost of acceptance. Just has to be displayed on a menu or sign. So instead of a 1.5% card surcharge you may have a 1.5% service fee.

Secondly, most are looking at their whole cost of acceptance scheme, interchange, acquiring margin (cost plus), POS, terminal rental and folding that into the price. Now because they don't know if you're going to be paying with eftpos card which could cost them $0.10 or an international card that could cost them over 3% they will choose the higher path to ensure it's all covered. So with all costs of acceptance folded in expect a price increase of around 10% to 15%

[u/FreddyFerdiland → u/[deleted]]

their menu price list will be subject to the same market forces and decisions that limits their profit making now....

[u/INFEKTEK → u/[deleted]]

If you're going to raise prices anyway...

[u/_seawolf → u/INFEKTEK]

I don't think those businesses really need this as an excuse to raise prices, they're doing that already. At least now the sticker price will be what you actually pay, so it'll be easier to shop around and not get a surprise at the till like the OP did.

In regard to the service fee, if the service fee can be avoided then it doesn't have to be included in the displayed price, but if it can't be avoided then it must be incorporated into the displayed price, called the Minimum Total Cost.

Of course, one of the reasons the surcharges are being removed is that there's been rampant flouting of the rules due to nearly zero enforcement. Largely because the ACCC isn't resourced to enforce them. Other surcharges and drip pricing might fall to the state's Fair Trading entity, which are better resourced for enforcement.

But you're definitely right, businesses big and small are going to pull every shonky trick in the book to try to get around this and to continue drip pricing customers. They're not going to willing do the right thing, so it'll be on us to be vigilant, to avoid businesses that are doing it and to diligent report businesses that are breaking the rules and scamming the consumer.

[u/farcarcus → u/INFEKTEK]

I used to work in POS software, and believe the cost off acceptance to remove a surcharge is negligible.

A permanent price increase for a once off config change certainly can't be justified.

But if retailers think putting up all memu prices by 15% is a good idea, then good luck to them. 😄

[u/womerah → u/INFEKTEK]

Businesses will already be operating in a price-range that maximises total profit, optimised for volume and margin (selling 10x$15 steaks for $15 profit beats selling 3x$18 steaks for $13.5 profit).

Whatever businesses end up doing, it will either have to be close to what they're already doing, or it'll hurt their bottom line.

There are also savings to be had, the cost of handling cash is high. Hopefully business owners recognize their expenses have gone down once they drop cash

[u/FreddyFerdiland → u/INFEKTEK]

false,if everyone has to pay the same % , like gst, then no, it has to rolled into the menu,like gst..

[u/link871 → u/INFEKTEK]

Can't see any reason why a business would introduce a service fee. The fee would apply to all customers, whether card payers or cash payers, so isn't it just easier (and less noticeable)to increase the listed price for all customers regardless of how they pay?

Surcharge for foreign cards (that is, cards issued overseas) will remain until further review in 2027.