What is Merchant/Least-cost routing?
When you make a contactless payment in person using Visa payWave, the company (merchant) charging you for the goods or services received, is charged a fee.
From June, if you are making a contactless payment with your debit card via a digital wallet, the merchant may choose to send the transaction via the debit network that costs them the least to accept. This does not affect which account your funds are deducted from but may lead to transaction fees being charged to you.
To avoid unnecessary debit card transaction fees with contactless payments you can:
- When making a purchase insert or swipe your card rather than choosing the contactless payment option and select ‘CR’ (Credit) to pay from your debit account.
- Go to your smartphone digital wallet settings, select either ‘Visa’ or ‘EFTPOS’ as your preferred debit network. By selecting ‘Visa’, you will avoid transaction fees on your Visa Debit or MyLimit Prepaid Visa card. However, a $1 transaction fee does apply for EFTPOS transactions. Both debit networks offer similar protections from fraud and disputed transactions.
Please Note: Merchant/Least-cost routing only applies to debit card transactions and does not affect credit cards (Extralite and SoLo).