How do EFTPOS machines & transactions work in Australia?

When considering how EFTPOS (Electronic Funds Transfer at Point of Sale) works, think of it as a conduit between your customer’s bank account and your own. In a nutshell, EFTPOS transfers funds from the card holder account (debit or credit) and deposits those funds into your merchant account.

EFTPOS machines come in different types, such as mobile EFTPOS machines which are designed to be carried by staff within venues to take payments on the go.

How money is moved

During the EFTPOS transaction, the acquirer – the EFTPOS provider (Example: Tyro Payments) – sends a request to the card holders bank to make sure funds are available and there are no fraud issues to consider. Once approved, the funds are moved later in the day over to the acquiring bank, and then moved over to the merchant bank account.

It’s all done securely, using encrypted data.

How EFTPOS payments work

The way the funds are processed depends on the type of account a customer uses:

• If using a debit, chequing or savings accounts, the transaction will travel through Australia’s debit card payment system, the eftpos network (not to be confused with EFTPOS)
• Credit payments can go through networks like Visa, Mastercard®, American Express, JCB, Diners Club, or UnionPay (these are all called ‘schemes’)
• Other payments like Apple Pay, Google Pay and Samsung Pay operate differently. The way these payments are processed depends on the cards loaded in the digital wallet on the mobile, tablet or desktop.

Keen to know more on how EFTPOS works?

Check out some of our other questions about EFTPOS or ask your own.

Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.
Apple Pay is a trademark of Apple Inc., registered in the U.S. and other countries.
Google Pay is a trademark of Google LLC.

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