Australian businesses are dealing with rising operating costs, higher card usage at checkout and increasing pressure to maintain strong customer experiences without sacrificing profitability. Merchant fees are one of the most common pain points for small and medium businesses. As card payments become the preferred choice for customers, those fees can quickly add up.
This has led many business owners to explore zero-cost EFTPOS. Before deciding whether zero-cost EFTPOS is the right solution for your business, it is important to understand how it works, what is required to stay compliant and how it impacts the customer experience. This guide walks through all of these considerations to help you make an informed decision.
Understanding What Zero Cost EFTPOS Actually Means
Zero-cost EFTPOS refers to an EFTPOS terminal that applies a compliant surcharge to card payments so that the processing fee is covered by the customer rather than the business.
When set up correctly, the terminal automatically calculates and applies the appropriate surcharge for each transaction type. The merchant does not manually add the amount or adjust prices.
This model differs from other no-fee or low-fee EFTPOS offers that may simply remove monthly terminal costs while still charging standard transaction fees. Zero-cost EFTPOS is focused specifically on eliminating per-transaction charges for the business through a regulated surcharge mechanism.
Customers pay a small additional amount that reflects the real cost of processing their payment. The merchant receives the full sale amount without losing a percentage to card schemes or banks. It is a straightforward way to reduce business expenses while keeping payment options open.
How Surcharging Works Under Australian Regulations
Surcharging is legal in Australia, provided it is done in line with the rules set by the Australian Competition and Consumer Commission and the Reserve Bank of Australia. These rules exist to ensure fairness and transparency for customers.
Under current regulations, businesses are allowed to apply a surcharge that reflects the actual cost of accepting a card payment. This cost typically includes merchant service fees, terminal costs, scheme fees and other legitimate expenses involved in processing that transaction.
Key points to understand include:
- A business cannot profit from surcharging. The surcharge must not exceed the real cost of acceptance.
- Surcharges must be clear and visible before payment is made. Customers must know what they will be charged.
- Different surcharges can apply to different card types, provided each amount reflects the associated processing cost.
- EFTPOS providers must give businesses accurate cost breakdowns to ensure compliance.
By using a zero-cost EFTPOS terminal that automatically manages compliant surcharging, businesses reduce the risk of non-compliance and avoid manual calculation errors.
The Advantages of Switching to Zero-Cost EFTPOS
Zero-cost EFTPOS appeals to many business owners because it removes one of the most unpredictable expenses in day-to-day operations. When card fees are passed on correctly, every sale contributes its full value to the business. This can create a noticeable shift in monthly budgeting, especially for operators who handle a high volume of small transactions.
A major benefit is the stability it creates. Instead of seeing card processing fees fluctuate based on customer behaviour, business owners can anticipate a more consistent financial position month to month. This makes planning easier and removes a layer of uncertainty from cash flow forecasting.
Another practical advantage is the simplicity of the setup when the right provider is chosen. With a modern terminal that automatically calculates compliant surcharges, business owners do not need to adjust prices or monitor card types manually. The terminal does the work, the customer pays the correct amount, and the business collects the full sale.
For many operators, the attraction lies in the combination of simplicity and savings. It is a relatively small operational change that can have a meaningful impact on overall profitability.
Limitations and Factors to Consider Before Switching
Zero-cost EFTPOS is not the right fit for every business. Consider:
- Customer attitudes toward surcharges, which can vary across industries and regions.
- The price sensitivity of your target market.
- Competitor practices and whether surcharging is common for similar businesses.
- The impact on average transaction values, particularly for higher-priced items.
- Communication required for transparency and compliance.
Taking the time to understand your customer base and industry norms will help determine whether zero-cost EFTPOS aligns with your business strategy.
When Zero Cost EFTPOS Works Best
Zero-cost EFTPOS provides the strongest benefits in industries where margins are tight, transaction volumes are steady, and customers are accustomed to paying by card.
Businesses that often see positive outcomes include:
- Hair salons and barbers that complete a high number of small or medium-sized transactions.
- Cafes, takeaway outlets and food trucks where most customers pay with tap and go.
- Small retail stores that want to stay competitive without absorbing rising processing fees.
- Trades and mobile service providers who operate with slim margins and rely on fast settlement.
- Allied health and wellness services that process card payments throughout the day.
A Practical Approach to Switching Smoothly
If your business chooses to move to zero-cost EFTPOS, a structured transition makes the process easier for both staff and customers.
A helpful checklist includes:
- Reviewing your recent merchant statements to understand your current fee structure.
- Comparing your industry norms to determine how common surcharging is within your market.
- Ensuring your EFTPOS provider automatically applies compliant surcharges.
- Updating in-store signage to keep customers informed.
- Preparing staff to answer simple questions about fees and transparency.
- Testing your terminal in real transactions to confirm correct surcharge calculations.
By following a structured approach, the shift to zero-cost EFTPOS can be seamless and cost-effective.
Partner With Venue Smart
Zero-cost EFTPOS can be a valuable tool for businesses looking to control expenses and simplify their financial operations. It is not the right solution for every industry, but for many small and medium businesses, it offers meaningful savings and greater clarity around transaction costs.
Venue Smart provides zero-cost EFTPOS solutions that are built for compliance, reliability and simplicity. Our systems automatically calculate and apply surcharges that meet Australian standards.
Book a demo today to see how a zero-cost EFTPOS solution can support your business growth and improve your cash flow.