Customers pushed to limit by eftpos minimums

IT'S time for your morning coffee. But because you don't have any cash, your $4-$4.50 coffee turns into coffee and breakfast.

For dinner you order takeaway and once again your lack of cash turns a $10-$12 meal into a $15 meal and drink combo, even though you have that nice bottle of wine waiting at home.

This is the reality we, as consumers, are faced with - these are the minimum eftpos transactions in place at some restaurants, cafes, supermarkets, newsagents, and ice cream stores.

Associate Professor of Business Strategy at the University of Queensland, Martie-Louise Verreynne, said businesses commonly claim the reason they have a minimum eftpos in place is because of the associated costs - such as bank charges, receipts and printing costs.

She said you could argue there was also a cost to cash transactions, "but those don't force businesses to set a minimum cash limit".

"These costs are the same for large and small transactions," she said.

"(Businesses) won't say it, but it is to get people to buy more," she said.

And according to a Reserve Bank of Australia study released in December, she's right. It even costs less for a business to accept a customer's card, over cash.

The study found a business pays, on average, 45c, for an eftpos transaction and 48c for a cash one.

Gladstone resident Jake Austin has worked behind a bar that had a minimum spend limit in place, he has had to deal with them while he is out shopping, and he is fed up with them.

"I will always shop in a place that doesn't have a limit," he said

"They are just trying to get more money out of us."

The owner of giftware shop, Ginger Says, Michelle Wilson doesn't impose a minimum transaction limit at her store.

"(The banks) charge you the same percentage, no matter how much you spend," she said.

"Why would you penalise someone for buying a small amount? I want all the sales I can get.

"Business is tough enough. We have to be as accommodating as we can."

Transaction charges are outdated, eftpos chief says

Eftpos is the company that runs Australia's most used card payments network for card transactions 

CEO Bruce Mansfield said he doesn't want merchants to charge customers for using the network.

"In an ideal world we would encourage all merchants to take down their minimum spend signs," he said.

"Having no limits makes it easier for consumers to use their cards and not have to carry cash."

Here's what two of the big banks had to say:

  • Commonwealth Bank does not allow clients to set a minimum transaction on eftpos machines.
  • National Australia Bank clients must request written permission in their agreements.


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