EFTPOS (Electronic Funds Transfer at Point of Sale)

EFTPOS, short for Electronic Funds Transfer at Point of Sale, is a payment system that uses a debit or credit card to electronically transfer funds directly at the point of purchase. The term is used both generically, to describe the broader category of card payments at a terminal, and specifically, to refer to Australia and New Zealand's domestic debit card scheme and network infrastructure.

As Australia's own domestic debit scheme, EFTPOS operates alongside international card networks such as Visa and Mastercard, and many Australian-issued debit cards can route a transaction over either network depending on merchant and issuer settings, a choice that affects the processing fees merchants pay.

Tapping or swiping a debit card at a shop checkout and having the money leave your bank account almost immediately is EFTPOS in action — the electronic link between the card terminal and the banking system that moves funds without cash ever changing hands. It is such a routine part of daily shopping in Australia and New Zealand that the terminal itself is often simply called "the EFTPOS machine."

Unlike a credit card transaction, an EFTPOS debit transaction draws directly from the cardholder's own bank account funds rather than extending credit.

When a card is presented at an EFTPOS terminal, the terminal communicates with the cardholder's bank to verify funds and authorize the transaction, then the merchant's bank and the cardholder's bank settle the transferred amount, typically within one to two business days, through the domestic EFTPOS network or a card scheme network depending on routing.

Australia's EFTPOS scheme, operated by eftpos Payments Australia, is a low-cost domestic alternative to international scheme debit processing, and Australian regulation has historically promoted merchant choice over which network processes a given debit transaction, in part to keep merchant costs competitive.

Modern EFTPOS terminals support contactless tap-and-go payments in addition to chip-and-PIN, and increasingly integrate with mobile wallets, extending the same underlying electronic funds transfer mechanism to phone- and watch-based payments at the point of sale.

Some merchants in Australia apply a small surcharge specifically to EFTPOS or card transactions to recover the processing cost involved, a practice regulated to ensure any surcharge charged reasonably reflects the merchant's actual cost of acceptance rather than becoming an additional profit center layered on top of the underlying sale.

The widespread adoption of EFTPOS across Australian retail over recent decades has coincided with a sharp long-term decline in cheque usage, as both consumers and merchants increasingly favored the speed and convenience of electronic card payments over writing and physically processing paper cheques for everyday purchases.

Because EFTPOS depends on live network connectivity between the terminal and the cardholder's bank, an outage affecting the broader payment network can temporarily leave merchants unable to process card transactions at all, which is part of why many Australian retailers still keep at least a modest cash float on hand as a practical backup during any EFTPOS system disruption.

Cardholders using EFTPOS generally receive similar fraud protections to those available on international scheme debit cards, including liability limits for unauthorized transactions and a formal dispute process for transactions the cardholder does not recognize, protections that largely mirror those set out under Australia's broader ePayments Code governing electronic consumer payments.

A cardholder who notices an unrecognized EFTPOS transaction is generally advised to report it to their bank promptly, since prompt reporting both limits potential liability and gives the bank the best chance of investigating and recovering the funds successfully.