A surcharge is an extra charge that customers pay on top of the price of your goods and services. A surcharge will usually apply when the customer chooses to pay with an EFTPOS card or credit card such as Visa or MasterCard with the surcharged amount intended to help you as the business owner cover the cost of processing the card payment (the cost of acceptance).

Surcharging method

We use differential surcharging; which allows you to surcharge according to the card that is being used. So you can surcharge the cost of each card type.

Costs that can be included in your surcharged amount

Only certain elements can be included in your cost of acceptance. These include:

  • Merchant service fees
  • The rental fee paid for your Live eftpos device

Excessive surcharging

New cost of acceptance standards will be enforced by the ACCC starting this year and small businesses are banned from excessive surcharging from 1 September 2017. Large merchants had to comply with these same standards as of 1 September 2016.

A permitted surcharge is defined in the RBA standard and your surcharge will be deemed excessive if it exceeds this definition. In a nutshell, if your surcharged amount exceeds your costs of acceptance, then it is not permitted.

Payment types covered by the ban

Covered payment types include:

  • EFTPOS (debit and prepaid)
  • MasterCard (credit, debit and prepaid)
  • Visa (credit, debit and prepaid)
  • AMEX “companion cards” (American Express cards issued through an Australian financial service provider, rather than directly through American Express).

Not covered payment types include:

  • BPAY
  • PayPal
  • Diners Club
  • UnionPay
  • AMEX cards issued directly by American Express
  • Cash and cheques.

It is also important to note that different businesses have different costs of acceptance. Some merchants’ costs might be higher than others.

The cost of accepting a Visa or MasterCard payment through a Live eftpos device is usually quite low, costing anywhere between 0.5% – 2% (inc. GST) of the transaction value depending on your type of business and the number of devices that you have.

Setting up surcharging with Live eftpos

When signing up for Live eftpos make sure you speak to your relationship manager about setting up your device with the ability to surcharge your customers. You also have the option to be set up with differential or blended surcharging.

If you are an existing customer without surcharging setup, you can change your preference by calling 1300 780 788 during business hours (9am-5:30pm Monday-Friday and 10am-4 pm Saturday) or email support@liveeftpos.com.au after hours.

We require your name, business name and terminal ID and we’ll respond to your query the next business day!

Read more:
Australian Competition and Consumer Commission: Q&A Payment Surcharges
The RBA credit card surcharge reforms: What you need to know

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Sam Edmond

Sam Edmond is Digital Marketing Director for Live group. His digital marketing experience includes roles in Auckland, London, and Sydney. Sam is a Kiwi and supports Arsenal F.C.