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Don’t let your business give you an EFTPOS hangover this New Year

As we near the end of another challenging year, business owners are reviewing their costs and searching for ways to reduce expenses in 2022.

One area of potential saving is your business EFTPOS fees. The pandemic has seen a decrease in the use of cash and a corresponding increase in card transactions. 

Merchants may believe that there aren’t substantial savings to be made by switching to a specialist EFTPOS provider, but not so, according to Peter Thomas, Chief Customer Officer at Smartpay. 

“There are approximately a million EFTPOS terminals in Australia, and the majority of the merchant terminals are issued by banks,” Mr Thomas explains. “Most people don’t realise they can get EFTPOS from a non-bank provider. What generally happens is business owners go to the bank to set up their business account, the bank asks if they want EFTPOS; then away they go.” 

The most common pricing structure is where the merchant pays a different rate depending on the type of card used. But what does this actually mean for the merchant? Mr Thomas says merchants could pay upwards of 2 or 3 per cent on a premium card, usually associated with reward points, and around 5 per cent on international cards. Domestic cards sit around 1 per cent.

The Reserve Bank reports that card use increased by 13.1 per cent in 2021, and the use of digital wallets grew by a staggering 90 per cent. “On average, we have seen merchants paying an increase in fees over the last year,” he explains. 

“The standard merchant probably paid around $5,000 a year in fees and could be paying upwards of another $650 – $1,000 on top of that, which is most likely due to the percentage increase in tap and go transactions.”

The freedom to choose

People used to be apprehensive about choosing specialist financial providers, but they are now far more trusting of non-bank suppliers for home loans, insurance, and superannuation. EFTPOS should be no different. 

Merchants often think it’s hard to change their EFTPOS facility because they believe this means changing banks, but they can keep their banking relationship and choose a non-bank EFTPOS provider to get a better deal.

“Smartpay supports more than 30,000 customers across Australia and New Zealand,” says Mr Thomas. “We’re not a startup; we’ve been in business for nearly 20 years, so people can trust Smartpay with their business, with their money.”

Simple products that save you money

Smartpay offers two products that not only save merchants on their EFTPOS bill but also provide predictable ongoing costs, which helps manage cash flow when times are tough.

The most significant benefit to merchants using the Zero Cost EFTPOS and Simple Flat Rate products is that Smartpay takes the risk on the type of card used for a transaction, with the merchant paying a set fee.

“If you think about going to a restaurant, or a café, or a hairdresser, most people are generally happy with a one and a half per cent surcharge for a service type business. And for customers who want to absorb these costs, we also give the merchant one rate.

“Our research shows that most customers are willing to pay a small fee on top of their transaction to support the merchant, but the primary factor is they want to know there is one beforehand. Smartpay is very open and transparent on behalf of the merchant and provides signage which is displayed on the counter and terminal.

With Zero Cost EFTPOS, merchants who have a monthly turnover of over $10k in card transactions on each terminal pay no terminal rental or transaction fees. The Simple Flat Rate option gives you control of costs as every transaction attracts a flat fee irrespective of what card the customer uses to pay. 

Remove the fuss & switch to us

A study by Canstar shows almost two out of three Australian merchants believe they could get a better deal on EFTPOS fees by shopping around, but less than one in four will switch from their current provider.

Why is that? Because banks use different fee structures, making it difficult to compare products, and merchants lack the time needed to identify the best option. They also worry there may be some downtime during the transition.

“We can usually have a terminal to a merchant within a week of approval of an application form,” says Mr Thomas. “Basically, they take the terminal out of the box and start using it. Just plug in and play. They don’t have to wait for a technician to come onsite and set it up, meaning very minimal downtime for their business. Not to mention, the merchant has access to our technical support team 24/7, 365 days a year if any queries arise.” 

But perhaps the most compelling reason to switch to Smartpay’s EFTPOS products is that they allow merchants to manage their cash flow better, and the savings they make can be reinvested back into their business.

Review your business costs and make the switch to Smartpay today to start saving on EFTPOS fees in 2022.