Payment Gateway Fees Explained

When a customer taps, swipes, or types in their card details, a lot is going on behind the scenes. Payment gateway fees are one of those unavoidable expenses that every business accepting card payments has to navigate. While each fee might seem small on its own, over time, they can eat into your profit margins more than you realise.

For Australian business owners, especially those in retail, hospitality, and e-commerce, understanding these fees isn’t just good accounting, it’s essential to running a lean, profitable operation. In this article, we’ll break down what payment gateway fees are, how much they typically cost, what hidden charges to watch out for, and what you can do to reduce them.

What Are Payment Gateway Fees?

A payment gateway is the technology that securely captures and processes customer payment details during a transaction. Whether you’re operating a cafe with EFTPOS machines or running an online store, the payment gateway is what makes card payments possible.

Payment gateway fees are the charges associated with using that service. These can include:

• Transaction Fees – Usually a percentage of the sale (e.g., 1.75%) or a flat fee per transaction (e.g., $0.30), or a combination of both.
• Monthly or Annual Fees – Some providers charge ongoing access or service fees just to use their gateway.
• Setup Fees – One-off charges for establishing your payment gateway, especially common with older or custom systems.
• Integration or Plugin Fees – Sometimes charged for connecting the gateway to your website or point-of-sale (POS) system.

It’s also worth noting the distinction between a payment gateway and a merchant account. Some providers bundle these together, while others separate them. Understanding this distinction is key to comparing offers accurately.

What Do Most Providers Charge?

Payment gateway fees in Australia can vary depending on the provider, your industry, and your transaction volume. Here’s a general overview of what some of the big names charge:

Note: Prices current as of writing and may vary depending on your business type or volume.

Online businesses generally pay slightly higher fees than brick-and-mortar stores, due to increased fraud risk and more complex processing systems. That said, in-person businesses may still face higher terminal or hardware rental fees.

Some payment providers offer tiered pricing, volume-based discounts, or custom quotes based on your average transaction size and monthly sales volume. It’s worth getting a tailored proposal, especially if you’re processing high volumes or running a multi-location business.

Hidden or Overlooked Fees to Watch For

The base transaction rate is just one piece of the puzzle. Many businesses get caught out by lesser-known charges, including:

• Cross-Border Fees – Applied when your customer uses a foreign card, even if you’re based in Australia.
• Chargeback Fees – Charged when a transaction is disputed and reversed by the customer’s bank.
• Settlement or Batch Fees – A charge is applied when your transactions are grouped and deposited into your bank account.
• Currency Conversion Fees – Charged if the payment is made in a foreign currency.
• Early Termination Fees – Some contracts charge you for cancelling before the agreed term ends.

These charges aren’t always front and centre in the pricing brochure. That’s why it pays to read the fine print or partner with a payment provider that keeps things transparent.

How to Reduce Payment Gateway Fees

While payment gateway fees are a cost of doing business, they’re not always set in stone. With the right strategies, you can reduce your costs and keep more of your revenue:

• Negotiate Based on Volume: If your business processes a high number of transactions or has large average sale values, you may be eligible for volume-based discounts. Don’t be afraid to ask.
• Bundle Your Services: Using the same provider for your payment gateway, merchant services, and POS system often results in lower overall fees and fewer hidden charges.
• Review Your Transaction Types: Are most of your customers using credit cards, debit cards, or contactless payments? Some payment types have higher fees than others—adjusting how you accept payments can impact your costs.
• Compare Providers Regularly: Don’t stay loyal to a provider out of habit. Fees change, and better options may emerge. It’s worth reviewing your setup every 12 months.
• Avoid Unused Features: Some gateways charge for advanced features like tokenisation or multi-currency support, which you may not even need. Trim the fat.

How Venue Smart Keeps Fees Transparent and Competitive

At Venue Smart, we work with businesses across Australia to make payment processing simple, seamless, and cost-effective. Unlike some international providers, we don’t believe in hidden fees or fine print. We offer customised solutions that match your business model.

Our team will assess your current setup, review your average transaction value and volume, and provide a tailored proposal that helps you save on every sale. Plus, you’ll get access to our full suite of services,including POS systems, ATMs, EFTPOS, and more, with local support whenever you need it.

Want to find out if you’re overpaying on payment fees? Contact us today.