Still charging a minimum purchase amount for EFTPOS? It’s time to reconsider

Does your business still decree a minimum purchase amount to customers for the privilege of being able to use EFTPOS? It’s really time to stop with that.


We all hate paying these, right?

Don’t be fooled; it’s not just the banks who are touching us up over these fees. Small retail, hospitality and service businesses are also charging very high fees (as a percentage) for ‘less than minimum transaction’ amounts.

I was recently levied $0.50 on a $9.50 transaction to use my EFTPOS card because it was ‘less than the minimum $10 spend’. I’m sure you’ve experienced something similar in your travels and really, this has to stop.

Don’t get me wrong, I’m all for small business making money, but this sort of thing is outdated and missing the mark.

“Don’t be fooled; it’s not just the banks who are touching us up over EFTPOS fees.”

The whole idea behind the fee for small transactions is not a cost recovery exercise. It’s supposed to be an opportunity to suggest a customer increase their total spend, to avoid the fee.

A kind of incentive to spend a little more.

Big fuel retailers do this by offering you chocolate bars and the like when you pay for your fuel. ‘If you spend another $10 in store you save 4 cents per litre off your fuel!’ Most of us don’t do the math on this though, and many people will jump at the seemingly large fuel discount. What they don’t realise is that, for the average tank of petrol at around 50 to 60 litres, they’re only saving $2 to $3 in exchange for their $10 spend!

The strategy is a successful one for the fuel retailer as they increase the average spend by their customers and customers feel good because they perceive they received a discount.

The problem with the previous example of the cafe where I stopped for coffee and cake is that, as a percentage, they actually slugged me more than 5% fee for the privilege of using my cashcard.

Not once was I offered the opportunity to increase my purchase by a small amount.

Nobody suggested I get a mug of coffee instead of a standard cup (which would have only been 80 cents more and thus avoided the 50 cent fee), or a bottle of water (it was a hot day) or even a small chocolate bar for the road (I was on my motorbike).

If you’re doing this in your business, please stop it. Today.

Not only are you missing the point of the strategy but you’re also running the risk of upsetting customers and, worse still, having them go elsewhere.

I happen to stop at this same cafe every week on my ride down from Toowoomba to the Sunshine Coast to see my daughter and visit some clients. It’s a nice little break in the middle of a three-hour ride, and I relish the coffee early in the morning before my day really kicks off.  There happens to be another cafe in the same town with reasonable coffee, and I worked out they don’t charge me extra to pay by card for purchases under $10.

Guess where I now stop every week?

It’s 2017 and people can now pay with their mobile phone. Very few of us carry cash and using the good old fantastic plastic is part of our modern lives. To penalise me for shopping with you and spending less than some arbitrary minimum is archaic and counterproductive. If you need to recover the fees charged by the banks for merchant facilities, put your prices up.

Seriously, for a typical small business turning over around $300,000 per year and paying roughly $1,000 per month in merchant fees, you’d need to increase your prices across the board by a measly one-third of 1 percent to recoup those costs.

Which do you think a customer would notice the most? Paying an extra 1 to 2 cents for a coffee or paying a 50cent surcharge because they spent less than the $10 minimum?

Do the math and don’t get caught in the race to recover costs. Instead, remember what customers will pay for – value, service and experience. Use that to your advantage and everybody wins.

Now, if only we could get this message across to the banks …

How To Control Staff Travel Spend

Six tips to manage business travel.

There are many factors involved when organising business trips — authorisations, bookings, duty of care, expenses, reports, claims and more — and these are in constant change prior to the trip, during and after it.

When it comes to business travel it’s paramount to establish some strategies, regardless of the method chosen to organise corporate travel.

These are some recommendations that any organisation that manages its employees’ travel should have in mind:

• Be proactive with travel management

Make bookings and give a travel allowance only after the business trip has been approved. Former Speaker Bronwyn Bishop’s $5000 helicopter ride from Melbourne to Geelong could have been easily denied if it had been submitted through a travel management platform.

This technology would have detected that the travel expenses exceeded the budget and would have rejected the travel request and asked Bishop for an explanation.

• Ensure travel is approved prior to booking

There’s no point in management looking at expenses after the money has been spent. With the right policies established, Labor MP Tony Burke’s family trip to Uluru would have been rejected or more information would have been requested.

• Ensure bookings include enough detail to understand their business value

In the private sector, Liberal MP Philip Ruddock would have had to specify the objective of his $6400 flight to Perth with his wife as well as their attendance to the Hollywood-themed ball hosted by the West Australian Chinese Chamber of Commerce.

• Make sure the requesting travel process is simple and easy

The user experience should be understandable and result in a high uptake across the business. Private and public organisations need to make decisions fast, specially in case of emergency.

For example, if there are bushfires and the Prime Minister needs to get to the affected area immediately the booking process can’t be slow; it always has to be easy and efficient. When travel requests sit within the set requirements, approval on travel expenses should be streamlined and fast.

• Set a robust travel policy from the outset

This includes accommodation budgets, transportation and reasonable cost expectations. This way anything outside of policy is immediately evident with additional approval required.

Federal Treasurer Joe Hockey’s family trip to Perth would have been reduced to one return-ticket for Hockey to attend interviews and meetings. Then he would have had to pay for his family to fly to Perth with him like any corporate traveller doing leisure — mixing business travel with leisure travel.

• Use a simplified system

Technology should allow users to request, approve, manage bookings and policies on any device, anywhere in the world. Technology also makes business travel easier and more efficient, taking out the pain points and providing organisations with complete control and visibility of their travel.

A travel and expense solution helps companies set policies and budgets, authorise or deny requests and automatically issues a report after every business trip.