What are merchant fees?

What are merchant fees? Several things fall under this umbrella:

  • EFTPOS rental and maintenance fees
  • Fees incurred processing card transactions, like credit card merchant fees
  • Cross border transaction fees
  • Switching fees
  • Fraud related chargeback fees (The fees, not the actual cost of the chargebacks!)


The cost of transactions

Different types of cards have different merchant fees.

When a customer pays using their debit card, you get charged a flat rate. When they pay by credit card, the cost depends on the type of card (e.g. Visa, Mastercard, American Express)

With different rates from each card brand, it can get messy.


Surcharges can help recover fees

You have the option to recover the cost of accepting these cards via surcharging.

However you should only be surcharging to cover up to your cost of acceptance. If your customers are excessively surcharged, you could come under scrutiny.



Making sure you stay compliant

So, how do you make sure you surcharge enough to cover your costs without breaking the rules?

The rules state that you need to look at your historical card data and how much it costs you to accept each card type over the previous 12 months, before deciding on a surcharge amount.

Tyro’s dynamic surcharging does the maths for you, giving you peace of mind that you are always surcharging the right amount and remaining compliant.



Keen to learn more?

Check out our FAQs on dynamic surcharging

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