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Half of small businesses unaware of least cost routing

Save money on electronic payments

8 September, 2022

Half of small businesses that process card payments are unaware of least cost routing, which automatically chooses the cheapest network for processing “tap and go” debit card payments.

The statistic comes from a NSW Small Business Commission survey.

The Commission has developed a factsheet on least cost routing to help businesses understand how it works and how to get a better deal on card payments.

In Australia, most debit cards have a functionality that enables transactions to be processed through either the eftpos, Visa or Mastercard networks.

Least cost routing, also called merchant-choice routing, automatically chooses the cheapest network when a debit card is tapped.

If least cost routing is not used, the transaction is automatically processed via the default network programmed in the card, Mastercard or Visa.

Not all payment providers offer least cost routing or may require businesses to upgrade their terminal before it can be accessed.