THE RULES FOR CARD PAYMENT SURCHARGES

What's a card surcharge?

• A surcharge is an extra fee that you can pass on to customers to recover the cost of accepting card payments.
• The surcharge applies to payments made by credit or debit cards.
• You can’t charge a customer more than it costs you to process the transaction. Your cost of acceptance is the amount it costs you to process a payment from a particular type of card.
• There are guidelines that have been set by the Reserve Bank of Australia (RBA) on how to apply this surcharge.

What cards does it apply to?

• Mastercard® Debit and Prepaid
• Mastercard Credit
• Visa® Debit and Prepaid
• Visa Credit
• eftpos Debit and Prepaid
• American Express® cards issued by Australian banks
• UnionPay.

It doesn't apply to American Express cards not issued by Australian banks, JCB, Diners Club or Discover Card, as well as gift cards issued by a store.

How does it work?

• Every year you can review your fees and charges and decide if you want to apply a surcharge for card  transactions. 
• Your review needs to be completed by September 1 each year. 

What are the steps to apply it?

Step 1. Review your cost of accepting card payments

The monthly cost of acceptance information, including the costs for each card type, will be included in your monthly merchant statements. The annual cost of acceptance will be shown in your June statement.

Your June monthly merchant statement, issued in early July each year, will include two tables which show how much you are being charged to process payments for different card types. 

• One table will show you your monthly cost of accepting card payments and the other table will show your average annual cost of accepting card payments.
• The amount shown is the maximum percentage surcharge you will be able to apply to a customer’s transaction if they pay by card. If you want to charge your customers more than this amount, you’ll need to provide proof of how you incurred those additional costs (using contracts, statements, or invoices). If you can’t verify the costs, you may potentially face a fine.
• Any surcharge you apply to card payments cannot exceed your average annual cost of acceptance. 

Here’s an example of how the table will show on your merchant statement. The rates shown are examples only. You will need to refer to your June statement to find the rates relevant to you.

Step 2. Apply that cost as a surcharge

Once you have reviewed your cost of accepting card payments in your June statement, you can apply that cost as a surcharge.

Here are a few examples of how you could apply the surcharge.

1. Apply one surcharge for all card payments

To make surcharging easier, you may wish to apply just one rate to all card purchases. You will need to apply your lowest annual cost of acceptance if you select this option.

In this example, 0.15% is the lowest annual cost of acceptance and the maximum rate you can charge. 

The rates shown are examples only. You will need to refer to your June statement to find the rates relevant to you.

This option is recommended if you would like to apply one surcharge for customers that pay by Mastercard and Visa, and another surcharge rate for eftpos and UnionPay.

In this example, 0.58% is the lowest annual cost of acceptance and the maximum rate you can charge for Mastercard and Visa cards. You can also apply a maximum surcharge of 0.15% for eftpos transactions and 1.60% for UnionPay transactions. 

The rates shown are examples only. You will need to refer to your June statement to find the rates relevant to you.

This option is recommended if you want to surcharge one rate for credit cards and another for debit cards. 

In this example, 1.30% is the lowest annual cost of acceptance for credit cards and 0.58% is the lowest annual cost of acceptance for debit cards. These are the maximum amounts you can charge if you apply one rate for each card type. You can also apply a maximum surcharge of 0.15% for all eftpos transactions and 1.60% for UnionPay transactions. 

The rates shown are examples only. You will need to refer to your June statement to find the rates relevant to you.

Step 3. Add the surcharge to your terminal or payment gateway

Once you have reviewed your statement and decided how you will apply the surcharge, it’s time to update your terminal or payment gateway.

How to enable surcharging on your terminal

The surcharge function on your EFTPOS Now terminal can automatically add a surcharge to save you having to calculate it manually.

To enable the surcharge:

1. Call the Merchant Helpdesk on 1800 029 749
2. Tell us your surcharge rates. For any surcharge above the figure on your monthly statement, you’ll need to retain proof of how you came to this cost.
3. We’ll apply the rate to your EFTPOS Now terminal.

How to enable surcharging on your integrated terminal

The surcharging function on your terminal can automatically add a surcharge to a purchase to save you having to calculate it manually.
 

How to update your payment gateway

To update your surcharge rate on Westpac PayWay: 

1. Sign into your admin console
2. Add your surcharge rates.

If you use a third-party payment gateway provider, then you should contact them directly to update your surcharges for the different card types. Check the list of third-party payment gateways that are accredited with us.

FAQs