Home – New Forums Money matters Surcharge with C/Card payments

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  • #979413
    AgentMail
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    Hi All,

    We are just about to begin offering Visa and Mastercard as a payment option, and wondered how others work this with their invoicing.

    What I am confused about is, when I invoice a customer, the invoice will show a certain amount, but if they choose to pay by ccard, there will be a 2.5% surcharge. Do I then have to go in and adjust the invoice to the new amount, or do ccard charges get excluded from the invoice amount?

    Thanks

    #1114124
    Johny
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    Unless it has changed, I was always under the impression you could not include a surcharge for customers using credit cards as it is against the terms and conditions.

    I am sure there are ways that people get around this, but I don’t think you can officially categorise it as a surcharge.

    #1114125
    Blue Jet
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    We have the option of receiving c/c payments and at the start we use to charge 3% surcharge on top of the service amount when paid by c/c. But we stopped charging a % as we found that many people didn’t like the idea of a surcharge when paid by c/c.

    I don’t know if charging a % is against the terms and conditions but don’t you make the terms and conditions yourself for your company? Unless otherwise its writing on your merchant agreement and accepted by you than that will be against the terms and conditions.

    You are not to charge a percentage only when you display the logos and text of “We accept all major Credit Cards” or “We welcome all Credit Cards” etc

    I have come across in many businesses out there that do charge a % if paid by c/c and they are happy to take that 2% | 2.5% even if its against the terms and conditions or not.

    #1114126
    AgentMail
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    Well I was told by the bank that I was allowed to charge a surcharge, and have been charged a surcharge plenty of times, so I think I am ok there, but just not sure how I am supposed to invoice it.

    #1114127
    Michael [The Mac Experts]
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    Visa/Mastercard for U.S. merchants typically don’t allow surcharging, and there’s a few U.S. states that actually outlaw it.

    However it’s legal to surcharge in Australia if it’s reasonable. If your surcharge is 2.2%, you should only pass this or something lower onto your customers – nothing more.

    However you should read the terms and conditions of your bank’s merchant account closely, some actually do forbid it within the conditions.

    #1114128
    Divert To Mobile
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    AgentMail, post: 127869 wrote:
    Well I was told by the bank that I was allowed to charge a surcharge, and have been charged a surcharge plenty of times, so I think I am ok there, but just not sure how I am supposed to invoice it.

    Create a new item called cc surcharge and add the line to your invoices
    Bit clunky unless there is an automatic way of doing it in your billing system.

    Steve

    #1114129
    Blue Jet
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    AgentMail, post: 127869 wrote:
    Well I was told by the bank that I was allowed to charge a surcharge, and have been charged a surcharge plenty of times, so I think I am ok there, but just not sure how I am supposed to invoice it.

    You will need to customise your invoice layout and add a text box to include c/c surcharge.

    Subtotal:

    $1,000.00

    G.S.T 10%

    $100.00

    3% C/C Surcharge:

    $33.00

    Total:

    $1,133.00
    #1114130
    Michael [The Mac Experts]
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    Divert To Mobile, post: 127875 wrote:
    Create a new item called cc surcharge and add the line to your invoices
    Bit clunky unless there is an automatic way of doing it in your billing system.

    Steve

    This is what we do, we prefer direct debit and direct deposit as our billing systems are automated.

    Credit cards have a real cost to us, both in security requirements and bank fees so
    having the surcharge as a line-item puts it into our customers mind that there is a cheaper/better way to pay – and it works, most customers, including our business clients pay via direct deposit which means less overhead and fees.

    #1114131
    Johny
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    Unless it has changed, I was always under the impression you could not include a surcharge for customers using credit cards as it is against the terms and conditions.

    My apologies. Seems the law was amended in 2003. Before that you could not add a surcharge.

    Some details here:-

    http://www.accc.gov.au/content/index.phtml/itemId/322972

    In my defence, (allbeit a poor one) my last involvement with this type of thing was in the ’90s.

    #1114132
    AdvancedPetSitting
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    We absorb all surcharges and don’t pass it onto our clients. It makes them happy and they give us repeated business.

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