Tyro introduce ‘Tap & Save’ to save small business
Business-only bank, Tyro have today announced the Tap & Save scheme designed to save small businesses processing costs when it comes to contactless payments.
In an Australian-first, the business banking lender will reroute all tap-and-go debit card transactions through the cheaper eftpos network - a move that is predicted to cut the merchant transaction fees by 20-30%.
By rerouting the payments through a more economical network, Tyro’s Director of Product, Bronwyn Yam believes Aussie businesses will be better equipped to succeed.
“Tap & Save has the potential to provide Tyro merchants with some relief from the expense of doing business,” she said.
“Our aim is to remove the barriers from business success and we are thrilled to give our customers the opportunity to be the first businesses in Australia to benefit from Tap & Save.”
How popular are contactless payments in Australia?
Small business owners know better than most just how popular contactless payments have become down under, they see them everyday.
But to give you some cold hard statistical backing, Mastercard last year reported that four in five Aussies were tapping their way through the week, reporting it as a “convenient” and “time-saving” way to pay.
“Australians have largely embraced contactless payments as a part of their everyday lives, indicating that consumers are starting to gain a real understanding and appreciation for the benefits of contactless,” said Garry Duursma, Head of Market Development and Payment Innovation at Mastercard.
And our preference for contactless transactions is probably best reflected in the extensive suites of wearables that providers have developed over recent months.
Westpac launched PayWear late last year allowing Aussies to pay via their watch, but was bested by Bankwest whose Halo ring (yes, an actual ring) won the Everyday Banking Innovation award in our recent Mozo Experts Choice Awards.
With Aussies now able and eager to tap their card, watch, wristband or ring to make purchases, it’s safe to say contactless transactions have become a popular payment method.
How much will small businesses save?
If you’re a cafe owner or independent store owner, you’ll be wondering just how much you’re likely to save on payment processing fees with the new Tap & Save scheme.
Right now almost all banks process contactless debit card purchases through pricier international credit card network which, according to the RBA, costs businesses an average 0.58% merchant transaction fee.
But rerouting the payments through the eftpos system - which attracts an average 0.26% in merchant transaction fees - could seriously save small businesses, with Tyro absorbing the costs.
“We constantly look at how we can make banking and payments easier and more cost effective for merchants,” said Yam.
“Tyro’s commitment to delivering value to customers with Tap & Save even comes at the expense of our own bottom line.”
Tyro have pushed through the new payment redirecting schedule a couple of weeks before the April 1 deadline, recommended by the House of Representatives Standing Committee on Economics, but expect a bunch of other business banking providers to follow suit over the coming months.
Are you a small business owner impressed with Tyro's latest changes? You can use our business baking hub to stay abreast of the latest trends as well as check out a range of business bank accounts or business loans.