Aussies love quick and easy ‘tap-and-go’ contactless payments to buy everything from food to flat whites.
But shoppers are being warned that the convenience comes at a cost, as retailers are slugged with huge fees that are often passed on to customers.
Watch more in the video above
Know the news with the 7NEWS app: Download today 
Contactless card payments (like payWave or payPass) cost businesses a lot of money. The Australian Retailers Association estimates banks charge businesses around $500 million every year to process card transactions.
Fees for tap-and-go are about four times higher than EFTPOS and add about 40¢ to a $100 transaction for a retailer or merchant.
Businesses then pass on the extra costs to consumers either through surcharges or by increasing the cost of goods across the store.
How it works
“Years ago we used to go into the shop, insert the card and have the option to select cheque, savings or credit,” Russell Zimmerman from the Australian Retail Association explained on Sunrise.
“If we pressed cheque or savings the transaction would go through the merchant’s facility, but the moment they put tap-and-go in they routed the transaction via Mastercard and Visa.”
“And that’s where it costs a percentage of the sale.”
“For example when you’re buying a $100 outfit it could cost the retailer $0.10 via the EFTPOS network or $0.60 via VISA or Mastercard when using tap-and-go.”
Shoppers are urged to pay via EFTPOS or cash to save retailers - and themselves - from forking out unnecessary fees.
Want more from Sunrise? Tap here!
