Inside the new payments revolution: Why Aussie businesses are leaving the Big Four banks

Small businesses are embracing new payments technology and financial services providers in droves. Here’s what’s driving that trend, and why it might be time to make the switch.

You’ve got a queue of people waiting to pay you. It’s your busiest time, everything’s going smoothly and you’re on course for a lucrative day’s trading. But then … your EFTPOS machine goes down.

Customers rarely carry cash nowadays and it’s a hassle for them to log into their internet banking and make a direct transfer into your account.

This downtime costs businesses tens of thousands of dollars a year, and it’s one of the reasons driving them to move away from clunky bank-issued EFTPOS terminals to new digital-first business banking solutions.

Australia is one of the most advanced nations in the world when it comes to new payment adoption. We led the global uptake of contactless ‘tap and go’ payments and the country is expected to be almost ‘cashless’ by 2025 – a trend that was accelerated by the pandemic.

Leading the drive is Zeller, an Australian financial services and payments technology company launched in 2021. Their products include the all-in-one Zeller EFTPOS machine, which comes with a free transaction account and business Mastercard.

Over the past year, more than 11,000 Australian businesses have switched their in-store EFTPOS payments to Zeller, with more than 80 per cent moving from a Big Four bank.

According to Josh McNicol, director of growth at Zeller, the pandemic fuelled the switch to newer providers as it allowed business owners to reflect on the tools and technology they were using to accept payments.

“They’ve had two years of lockdowns and trading restrictions, and now they can sit back and go, ‘OK, who’s helping me to save money? Who’s accelerating my cash flow? And how am I going to get that money into my bank account faster?” he tells Kochie’s Business Builders.

The mass exodus from Big Four banks suggests that they’re coming up short on all three.

Watch Kochie’s Business Builders interview: Josh McNicol, Zeller

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1. Businesses want simple solutions

As well as avoiding the problems caused by terminal outage and downtime, business owners are looking for simple, integrated solutions offered by new payment technology providers.

On average, businesses use three to five independent pieces of software to run their operations. Newer payment services providers offer more seamless connectivity between platforms as opposed to standalone EFTPOS solutions offered by the banks.

“We’re making it really easy to get up and running,” says Josh. “It takes on average five and a half minutes for someone to sign up online. Also the product itself is really easy to use. You can pick up your terminal and be up and running in a matter of minutes.”

In the past year, Zeller has launched hundreds of enhancements including over-the-phone payment processing, branded digital receipts, a contact directory to store customer details and receipts, and coming soon, an integrated point-of-sale product to further reduce manual tasks.

2. Mobile connectivity is key

Another reason businesses are gravitating towards new fintech providers is mobility – something that hard-wired EFTPOS systems can’t provide.

Businesses are more mobile nowadays and selling in more locations including festivals, markets and popups.

Tradies are keen to speed up their cashflow by accepting payments on-site instead of invoicing after they’ve done the work, and most restaurants have introduced pay-at-table dining.

In these settings mobile terminals with roaming connectivity are essential.

Zeller’s mobile terminal, for example, includes the option of a SIM card so you can switch to other networks by 3G if your Wi-Fi stops working, making the chances of not being able to take card payments rare.

3. Show me the money

Last, but by no means least, cost considerations are a major factor in businesses moving away from bank-issued EFTPOS systems.

Big banks typically charge a monthly rental fee for their EFTPOS terminals even if a business isn’t making any transactions. This is on top of hefty and often hidden fees, lock-in contracts with arduous terms and conditions, and a long list of varying charges for different card types.

Newer payment technology providers like Zeller offer a one-off charge for a terminal that you own forever, a flat-rate fee for all card types and no lock-in contracts.

According to research Zeller carried out in 2021, 61 per cent of Australian businesses are looking to switch payment providers because of high costs, expensive fees and slow deposits to their funds which impacts cash flow.

This shows that while the big banks may have legacy, business owners are willing to invest in and trust new players. And this is particularly the case for regional businesses. Almost half the businesses signing up for Zeller are from non-metro areas.

“These businesses feel a greater sense of disenfranchisement from the banks as a result of expensive fees, accelerating branch closures and lack of access to local banking services,” says Josh.

So, what should you look for when switching payment providers? 

Simpler pricing

Look for clear and simple fees from any provider you select. Ask about hidden fees, contract terminal fees, and monthly rental fees. Avoid lock-in contracts.

Uptime and support

What percentage of time can your EFPTOS provider claim to be up and ready to accept payments? Anything less than 99.99 per cent uptime risks a cost to your business.

Connectivity

How does your payment solution connect with your accounting and point-of-sale software? It needs to work seamlessly with the tools you use to operate your business.

Mobility

Are you serving and settling bills at outdoor dining tables, or running a busy bar with multiple payment points? Terminals that are mobile with roaming connectivity including SIM and Wi-Fi means that payments move with your business and customers.

Digital innovation is only set to increase. According to the 2021 Global Fintech Rankings, Australia moved up two places and currently ranks sixth in the world.

Businesses can now choose the best payment solutions and the days of telling your queue of customers “Sorry, our EFTPOS system is down” are over.

Find out more about Zeller’s payment solutions and sign up here.

This article is brought to you by Kochie’s Business Builders in partnership with Zeller.