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Merchant fees are a necessary part of accepting card payments — but without a clear understanding of how they work, they can quietly eat into your margins. This guide explains what merchant fees are, how they’re calculated, and the practical steps Australian businesses can take to reduce them, without compromising customer experience. What are merchant fees? Merchant fees are the charges a business pays to process card payments. Each time a customer taps, inserts, or pays online, several parties are involved in completing that transaction — and each takes a small fee for their role. While these fees are usually charged as a percentage of the transaction value, the exact amount can vary depending on the card type, payment method, and pricing model used by your payment provider. What makes up a merchant fee? A typical merchant fee is made up of three main components: Interchange fees: Paid to the customer’s card‑issuing bank. These fees vary based on factors such as card type (debit, credit, premium — read more about this below), transaction method (in‑person or online), and whether the card is domestic or international. Card scheme fees: Charged by card networks such as Visa, Mastercard, and American Express. These cover the cost of maintaining payment infrastructure and network security. Merchant services fees: Charged by your payment provider for processing the transaction and providing hardware, software, reporting, and support. Understanding how these components fit together makes it easier to compare providers and spot hidden costs. How are merchant fees calculated? The way your fees are calculated depends on the pricing model used by your payment provider. Common models include: Flat‑rate pricing You pay a single, fixed percentage for each transaction, regardless of card type. This model offers predictability and simplicity, making it easier to forecast costs.  Interchange‑plus pricing You pay the true interchange fee for each transaction, plus a fixed margin charged by your provider. With this model, fees can vary widely month to month, making it very hard to predict and budget accordingly.  Tiered pricing Transactions are grouped into tiers (e.g. qualified, mid‑qualified, non‑qualified), each with different rates. This model is often less transparent and harder to predict. Merchant fees can also vary based on whether a transaction is card‑present or online, and whether the card is domestic or international. Compare merchant fees in Australia Compare merchant fees for Square, Zeller, Sumup and Tyro. Debit vs credit card fees: what’s the difference? Debit cards generally attract lower interchange fees than credit cards, as funds are drawn directly from a customer’s bank account. Credit cards — particularly premium or rewards cards — tend to cost more to process due to higher interchange rates. Understanding this difference can help businesses make informed decisions about surcharging, minimum spend policies, or payment acceptance strategies. Should your business accept American Express? American Express is often associated with higher‑spending customers, making it an attractive payment option for many businesses. While AMEX has traditionally carried higher fees, modern payment platforms, like Zeller, can simplify pricing and reduce complexity. Accepting American Express can: Increase average transaction values Improve customer convenience and satisfaction Help capture spend from domestic and international customers who prefer AMEX With transparent, flat‑rate pricing, accepting American Express no longer needs to come with administrative overhead or unpredictable costs. Do merchant fees have GST? In Australia, merchant fees are generally subject to GST when they are charged as part of a payment provider’s processing or service fee. This means the merchant services component of your fees will usually include 10% GST, which GST-registered businesses can typically claim back as an input tax credit on their BAS. However, some elements of card payments — particularly those considered “financial supplies”, such as interchange fees paid to banks — may be treated differently and not attract GST. Because fees are often bundled, it’s a good idea to check your provider’s invoice or statement to understand how GST is applied in your specific case. How to reduce your merchant fees While some costs are unavoidable, there are several practical ways businesses can reduce the overall cost of accepting payments. 1. Understand what you’re being charged Review your merchant statements regularly and make sure you understand how your fees are structured. If pricing isn’t clear, ask your provider for a full breakdown. 2. Choose transparent pricing Simple, flat‑rate pricing can help avoid bill shock and make it easier to compare providers. Be wary of pricing models that obscure how fees are calculated. 3. Avoid long‑term contracts Some providers lock businesses into lengthy contracts with high exit fees. Flexible, no‑lock‑in agreements make it easier to switch if your needs change. 4. Consider surcharging or zero‑cost EFTPOS Surcharging allows businesses to pass on part or all of the cost of card payments, where permitted by law. Zero‑cost EFTPOS options can help offset transaction fees without increasing base prices. Read our blog to find out whether surcharging is right for your business .  5. Reduce chargebacks and disputes Clear refund policies, accurate transaction descriptors, and good customer service can help prevent disputes — saving time and money. Learn how to safeguard your business against chargebacks . 6. Choose the right payments partner Look for a provider that offers transparent pricing, modern terminals, local support, and tools that help you manage payments efficiently.

Running a business is all about cash flow — how quickly you get paid, how swiftly you can access your money, and how easy it is to manage your finances. A traditional business bank account often falls short on all three . Especially when it comes to settling payments from customers. With a Zeller Transaction Account , your business gets a faster, smarter, and more flexible way to accept payments, access funds, and manage everyday finances. This article explains how.  Faster and simpler access to your money One of the biggest frustrations for business owners is waiting days for funds from card payments to become available. Traditional banks and payment processors typically run settlement processes in batches, with multiple checks to reduce fraud — and this can delay access to your takings for up to several business days. With Zeller, funds from transactions accepted via Zeller Terminal (or other Zeller payment methods) are automatically settled nightly into your Zeller Transaction Account — and are available to spend as soon as the next day. This means you don’t have to wait multiple days just to access the money your business has already earned. If you prefer, you can also direct your settlements to a third-party bank account by adding your external BSB and account number in the Zeller Dashboard . Once set up, these transfers typically complete by the next business day. A transaction account designed for modern business Beyond faster access to payments, a Zeller Transaction Account gives you features that make daily financial management easier and more intuitive: No monthly fees, setup fees, or lock-in contracts — it’s free to open and use your transaction account. Quick online setup — open a business account in minutes without visiting a bank branch. Real-time visibility into balances and transactions via the Zeller Dashboard or Zeller App , helping you stay on top of your cash flow. Unlimited free debit cards and sub-accounts , so you can manage operating funds, savings, and expenses separately. Easy bill payments with BPAY directly from your Zeller Account. Attach receipts, notes and customer contacts to transactions for clearer record-keeping and simpler bookkeeping. Zeller integrates with Xero , allowing your transactions and settlements to sync automatically into your accounting software, making reconciliation easier and reducing manual data entry. More than just faster settlements By combining your payment acceptance, settlement, and business banking into one platform, Zeller eliminates the delays and fragmentation that come with using separate systems. Whether you’re paying suppliers, managing staff costs, or reinvesting in your business, getting your funds sooner and having clearer visibility into your financial operations makes planning and growth simpler.

It’s a new year, and the holiday season is already starting to feel like a fuzzy memory. But for many retailers, Christmas isn’t fully over just yet – because January and February mark the season for returns. With many customers looking for exchanges, refunds, or adjustments to their festive purchases, the challenge is to turn returns into an opportunity to strengthen customer relationships and even boost your revenue. Here are three practical tips to help you manage post-Christmas returns seamlessly. 1. Make store credit that bit sweeter Entice customers to opt for store credit instead of refunds by offering added perks. For example, consider providing a small bonus for store credit returns, such as an extra 10% on top of their credit total. Not only does this retain the revenue within your business, it increases the likelihood of customers spending more as they’re now closer to either another item or swapping for something with a higher ticket price (and paying the difference). Highlight this option prominently in store and make sure your staff mention it to customers seeking a return. 2. Open up your return window January is often a very busy month, with many people taking overseas and interstate trips or rushing around getting ready for the new school and work year. By offering an extended return window, you’ll create goodwill and reduce the pressure on your staff to handle returns all at once. Communicate your flexible return policy clearly through your website, email and social media. It’s a good reason to stay fresh in customers’ minds and they’ll appreciate the gesture if they need to use it, helping to make for repeat business and a stronger brand reputation. 3. Use returns to upsell or cross-sell Remember, every return is an opportunity. Remind your staff to approach returns as a chance to engage with customers to help them find what they need. If someone is returning an item, suggest alternatives, complementary products, or upgrades. For example, if a customer is returning a pair of jeans, offer a different size or colour before simply processing a refund and watching the dollars depart the store. By implementing these strategies, you’ll increase your chances of turning returns into opportunities to drive additional sales and build stronger customer relationships.