Guide to Merchant Obligations – Service Fees

By April 16, 2019 Your EFTPOS Facility
Do you want to offer your customers flexible payment options without increasing your costs? Applying a service fee is an excellent way to recoup the cost of your payment solution. You must meet some obligations if you add a service fee to your normal prices.

 

Do I need to tell my customers about the service fee?

Yes, businesses must clearly identify the full cost to purchase a product or service up front, so that consumers can make an informed decision about whether to purchase. You must clearly display notices, signs or decals at your physical premises, as well as a notice next to your point of sale, disclosing that you will apply a service fee when payment is made by card. In the absence of a physical point of sale, such notices or signs must be displayed prominently during an Internet order transaction or communicated clearly in a telephone order, in each case prior to the transaction being processed. We can provide you with a sign to display at your Point of Sale.

 

When do I need to tell my customers about the service fee?

You must ensure the service fee is clearly disclosed to the Cardholder prior to the completion of the transaction and give the Cardholder the opportunity to cancel once the service fee has been disclosed. Our Service Fee solution has been developed to meet this obligation by offering customers the opportunity to cancel the transaction.

 

How do I work out the value of my service fee?

You can choose to apply the service fee as a flat fee, or as a percentage (with optional minimum and maximum surcharge amounts). You can also set a minimum and maximum purchase amount that triggers a service fee. Our Service Fee solution has been designed to clearly display the service fee amount on the terminal screen.

 

Are there limits to the amount I can charge?

Yes, there are maximum limits. If you choose to apply the service fee as a flat fee the maximum is $20; if you choose to apply the service fee as a percentage the maximum is 20%.

 

Does the service fee have to be part of the purchase transaction?

Yes, the service fee must be processed as part of the total amount of the transaction. We have taken care of this obligation for you as part of our Service Fee solution.

 

How do I describe the service fee to my customers?

Inform your customers that you apply a service fee to payments made using a card. You must not describe the service fee as, or inform the cardholder that the service fee is, applied by a card scheme, by us or by a third party financial institution.

 

What payments can I add a service fee to?

You can apply a service fee to all debit and credit card purchase or telephone order transactions. You can’t apply a service fee to a contactless transaction to a PayPass or payWave card.

 

Does the service fee amount have to display separately on the receipt?

As part of our Service Fee solution, we have taken care of the receipt requirements for you. The transaction and service fee amounts are listed separately on the receipt.