eftpos Australia: An in-depth guide


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  1. Introduction
  2. What is eftpos Australia?
  3. Where is eftpos Australia used?
  4. Who uses eftpos Australia?
    1. Businesses that use eftpos Australia
    2. Customers using eftpos Australia
  5. How eftpos Australia works
  6. Business benefits of accepting eftpos Australia
  7. eftpos Australia security measures
    1. Data encryption and protection
    2. Tokenisation technology
    3. Real-time monitoring and fraud detection
    4. Compliance with industry standards
    5. Multi-factor authentication (MFA)
    6. Collaboration with financial institutions
    7. Customer and business education
  8. Requirements for businesses that want to accept eftpos Australia
    1. Merchant account
    2. eftpos terminal integration
    3. Confirming network connectivity
    4. Meeting regulatory standards
    5. Staff training
    6. Service provider agreements
    7. Commitment to software updates
  9. Alternatives to eftpos Australia

eftpos Australia is Australia's network of choice for its electronic funds transfer at point of sale, or EFTPOS, system. A key player in the country's financial transactions, eftpos Australia has become synonymous with debit card transactions across the country. It offers a direct, real-time connection between the retail environment and banking systems, enabling customers to pay for goods and services with an immediate withdrawal of funds from their bank account.

Launched in Australia in the 1980s, the EFTPOS system is an important part of the country's payment environment. In 2021, there were over 940,000 EFTPOS terminals in Australia, according to Statista. While eftpos Australia caters predominantly to the domestic market, any business that handles transactions within Australia's borders is likely to encounter it.

eftpos's success and influence is partly tied to its integration with international card schemes, which allows Australians travelling abroad to access funds via linked networks.

What's in this article?

  • What is eftpos Australia?
  • Where is eftpos Australia used?
  • Who uses eftpos Australia?
  • How eftpos Australia works
  • Business benefits of accepting eftpos Australia
  • eftpos Australia security measures
  • Requirements for businesses that want to accept eftpos Australia
  • Alternatives to eftpos Australia

What is eftpos Australia?

eftpos Australia is the network behind Australia's EFTPOS – an acronym for Electronic Funds Transfer at Point of Sale – system, which is the foundational technology that first enabled debit card transactions in Australia. Since its launch, the EFTPOS system has transformed the retail sector by enabling instant transfers from a customer's bank account to the retailer's bank account during a purchase. This innovation helped accelerate Australia's shift from cash-based transactions to digital payments.

As of 2021, the EFTPOS system made up a considerable share of transactions in Australia – a testament to the service's continued widespread use across the country. As the payment environment has evolved, so has eftpos Australia: the network handles physical card and ATM transactions as well as online payments.

eftpos can be integrated with global payment networks as well, which allows it to serve Australian cardholders as they travel internationally. The service supports transactions across a variety of channels, such as digital wallets and online shopping portals. eftpos's ability to adapt to the changing developments in payments indicates that it will continue to play a key role in Australia's payment environment.

Where is eftpos Australia used?

eftpos is most widely used in Australia, where it handles a major portion of the country's debit card payments and is a standard, widely accepted payment method. eftpos Australia technology facilitates daily transactions across a broad spectrum of Australian commerce – from supermarkets to small independent businesses – and it is a core feature of the country's retail economy.

New Zealand also uses the EFTPOS system. Despite the presence of other international payment options in New Zealand, the EFTPOS system retains a strong user base, with many New Zealanders relying on it for their everyday purchases.

Australian cardholders can also use their eftpos cards internationally if they carry certain co-branded cards. eftpos Australia facilitates this through links with global payment networks, which allow the network to run cross-border transactions and access funds for travellers and businesses operating abroad.

Who uses eftpos Australia?

eftpos Australia is a key payment method for a large cross-section of Australian society.

Businesses that use eftpos Australia

  • Retail establishments
    From small local shops to chain supermarkets, Australian retailers consider eftpos a reliable method for high-frequency, low-value purchases.

  • Hospitality and service industry
    eftpos is also frequently used in restaurants and cafes and in the hospitality industry – areas that make use of eftpos's ability to process payments swiftly and securely.

  • Health and personal care services
    Medical practices, pharmacies and wellness centres often use eftpos payments due to their speed and reliability.

  • Transport and logistics
    Australian customers are increasingly choosing cashless transactions in their commutes and deliveries, and taxi services and logistics companies have implemented eftpos systems to accommodate this preference.

  • Education providers
    From private schools to universities, educational institutions leverage eftpos to collect fees and payments.

Customers using eftpos Australia

  • Older customers
    Older customers tend to use eftpos for its simplicity and direct link to their bank accounts, valuing the familiarity of a system that has been part of the Australian payment scene for over 40 years.

  • Younger adults and families
    Younger adults and families seeking efficient and accessible payment methods use eftpos, as it is a readily available payment option at the vast majority of point-of-sale terminals.

  • Tourists and international visitors
    Australia's tourism sector also benefits from eftpos. Visitors from abroad can access their funds at eftpos terminals, bypassing the hassle of currency exchange and cash handling for an easier payment experience.

  • Small and medium-sized enterprise owners (SMEs)
    SMEs use eftpos for its low barrier to entry and straightforward fee structures, which helps with accounting and financial management.

How eftpos Australia works

Recent statistics indicate that the EFTPOS system is responsible for a sizeable share of transactions in Australia as of 2021. (While 2022 saw an almost 18% decline in EFTPOS terminals, this has been attributed, in part, to the overall drop in the number of brick-and-mortar retailers.)

  • Transaction initiation and routing
    Customers can use eftpos Australia to pay via card-present transactions and through contactless payment using NFC technology. When a customer initiates a payment, eftpos terminals connect to the business's bank (the acquirer), which communicates with the customer's bank (the issuer) to verify funds and approve the transaction. The eftpos Australia network facilitates this communication by routing the request via secure channels for transaction validation.

  • Data security measures
    eftpos Australia employs industry-standard encryption to secure transaction data in transit. The network adheres to stringent Australian data protection regulations and upholds the required security protocols to safeguard customer information. eftpos also incorporates tokenisation for contactless payments, ensuring sensitive card information is never exposed during the transaction process.

  • Associated costs and fees
    eftpos Australia charges businesses a transaction fee, which can vary based on the business's size, transaction volume and the agreement with the acquiring bank. Additional fees may apply for rental of eftpos Australia terminals and access to enhanced services, such as integrated point-of-sale systems. Generally, customers do not pay eftpos a fee for using the service, although individual banks may impose fees for certain account types or services related to the use of eftpos cards.

Business benefits of accepting eftpos Australia

  • Broad acceptance and familiarity
    Customers recognise and trust EFTPOS, which is one of the most established payment systems in Australia. This can translate to more sales.

  • Transaction efficiency
    The EFTPOS system is known for its fast processing times, contributing to a smoother checkout experience for customers and a more streamlined operation for businesses.

  • Security protocols
    eftpos Australia upholds strict security standards to safeguard transaction data, helping businesses protect customer information and prevent fraudulent transactions.

  • Data-driven insights
    By analysing transaction data provided by eftpos Australia, businesses can gain valuable insights into customer spending patterns and preferences that can help inform their marketing and sales strategies.

  • Versatility in payments
    eftpos terminals can handle a variety of payment types – including savings, cheque and credit options—providing flexibility for customers and businesses.

  • Integration with business systems
    eftpos Australia systems can be integrated with other business management tools to create a comprehensive system for reporting, inventory management and financial reconciliation.

  • Support for loyalty programmes
    Businesses can integrate their loyalty schemes with eftpos transactions, improving customer retention and encouraging repeat business.

eftpos Australia security measures

Data encryption and protection

eftpos Australia's security system relies on advanced data encryption that safeguards transaction data from the moment a transaction begins. The data remains encrypted as it travels through the network to the bank, which ensures that sensitive information is not accessible during transmission.

Tokenisation technology

To further protect cardholder data, eftpos employs tokenisation, which replaces sensitive card details with a unique identifier or token – greatly reducing the risk of data breaches.

Real-time monitoring and fraud detection

eftpos Australia uses sophisticated algorithms and continuous surveillance to monitor transactions for suspicious activity. This proactive approach allows the network to immediately detect and prevent fraudulent transactions.

Compliance with industry standards

eftpos Australia adheres to the Payment Card Industry Data Security Standard (PCI DSS), which ensures that its systems meet the high levels of security required for card transactions.

Multi-factor authentication (MFA)

In some scenarios, eftpos Australia will use multi-factor authentication to add an additional security layer, prompting the customer to enter a PIN, SMS code or biometric verification to process the payment.

Collaboration with financial institutions

eftpos Australia works closely with banks and financial services to ensure that its security measures are in line with those of the broader financial environment.

Customer and business education

eftpos Australia invests in educating businesses and customers about safe payment practices, providing information on topics such as how to safeguard PINs, how to recognise suspicious activities and why secure payment environments are important.

Requirements for businesses that want to accept eftpos Australia

Merchant account

Businesses must set up a merchant account with a bank or financial institution that supports eftpos. This account is where funds from eftpos transactions will be deposited.

eftpos terminal integration

Businesses must acquire an eftpos terminal – one that is standalone or integrated into a POS system. The hardware must be compliant with eftpos standards and capable of handling chip and PIN transactions.

Confirming network connectivity

Businesses must confirm that they have a reliable internet or phone connection before they're accepted as eftpos merchants. They must prove that their system can communicate continuously with the eftpos network for real-time transaction processing.

Meeting regulatory standards

Before they can accept eftpos Australia payments, businesses must comply with PCI DSS to safeguard cardholder data. This compliance is key for preventing unauthorised access and data breaches.

Staff training

Businesses must train staff on the proper use of eftpos terminals, including how to process transactions, how to handle errors and relevant security measures to prevent fraud.

Service provider agreements

Businesses must have a service agreement with the eftpos service provider, outlining the terms of service, fees and operational guidelines.

Commitment to software updates

Businesses that accept eftpos Australia payments must agree to regular software updates to keep their systems up to date with the network's latest security patches and features.

Alternatives to eftpos Australia

Today's payment environment offers several options for payment methods, each with unique advantages and disadvantages. Below are some popular alternatives to eftpos Australia.

  • Visa and Mastercard: Visa and Mastercard facilitate a wide range of payment options, such as credit, debit and prepaid cards. They have a large presence in the Australian market and are a convenient, widely accepted option around the world.

  • BPAY: BPAY is a prominent bill-paying service that allows customers to make payments directly from their banking accounts. BPAY is popular in Australia, especially for utility and service-provider payments.

  • Afterpay: Afterpay is a payment option with a buy now, pay later (BNPL) model, allowing customers to pay off purchases in structured instalments. Afterpay appeals to customers who value flexibility in payment scheduling and financial management.

  • PayPal: A global leader in online payment services, PayPal has a comprehensive suite of payment options for both online and in-person transactions. In Australia, PayPal is a popular payment option for e-commerce businesses.

  • Apple Pay and Google Pay: These mobile payment and digital wallet services offer contactless payment options that are processed through a customer's smartphone. Australia has seen an increased adoption of these payment methods – which appeal to a tech-savvy demographic – amid the growing preference for contactless transactions, particularly in the retail and hospitality sectors.

The content in this article is for general information and education purposes only and should not be construed as legal or tax advice. Stripe does not warrant or guarantee the accurateness, completeness, adequacy, or currency of the information in the article. You should seek the advice of a competent attorney or accountant licensed to practice in your jurisdiction for advice on your particular situation.

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