Every tap counts – literally
Debit cards now account for over 75% of all card payments in Australia.1 For many Australian businesses, small differences in how debit card transactions are processed can quietly add up in sizeable fees each year.
That’s where Merchant Choice Routing (MCR), also known as Least-cost Routing (LCR) comes in. It’s one of the simplest and most effective ways businesses can take control of their payment costs, yet it’s often misunderstood or overlooked.
What is Merchant Choice Routing?
In Australia, most debit cards are multi network, with an international card scheme (like Visa or Mastercard) on the front, and Australia's local debit card network, eftpos, on the back.
When a customer taps their debit card, that transaction can typically be processed through more than one network – either an international scheme or eftpos (not to be confused with the EFTPOS payment terminal).
Merchant Choice Routing allows businesses to choose which network eligible debit transactions are sent through, typically the lowest-cost option available. The process happens automatically in the background, with no change to the customer experience.
Customers can still tap-and-go or checkout online – but behind the scenes, the transaction could be routed in a more cost-effective way.
Why MCR matters for businesses
Over 50 million debit cards are eligible for MCR - that's more than two cards per customer! As volumes increase, even small differences in per-transaction costs can have a meaningful impact on your bottom line.
For businesses, switching on MCR can help deliver:
- Lower transaction costs by routing debit card payments through the lower cost network
- Greater transparency and control over how payments are processed
- More competition and choice in the payments ecosystem, helping keep fees fair and sustainable
- Stronger domestic resilience, by supporting Australia’s local debit card network
According to the Reserve Bank of Australia (RBA), the cost of accepting debit card transactions is nearly 20% lower for businesses that have MCR switched on.2
Common myths about MCR
Despite its benefits, some misconceptions still hold businesses back:
- “It will confuse customers.”
In reality, customers won’t notice any difference. The experience at the terminal and online stays the same.
- “It’s only for large retailers”
MCR can benefit businesses of all sizes. Any merchant accepting debit cards can potentially see savings.
- “It’s hard to set up”
Most modern payment terminals already support MCR. In many cases, it’s simply a configuration setting your bank or payment service provider can switch on.
What MCR looks like in practice
Once switched on, MCR works automatically. Your terminal identifies eligible debit transactions and routes them via your preferred network, typically the lowest-cost option available.
Many banks and payment service providers already support MCR, but it isn’t always switched on by default, which means some businesses may be paying more than they need to.
A simple question to ask your provider is: “Is Merchant Choice Routing switched on for my terminals – and if not, why?”
Where is MCR available?
MCR is widely available for in-store point of sale (POS) transactions and is increasingly being extended to online (ecommerce) debit payments as well. Availability can vary by provider, so it’s worth checking what’s supported across your sales channels.
Getting started
If you’re unsure whether MCR is available for your business, a good first step is to:
- Speak with your bank or payment service provider about your current routing setup
- Ask whether MCR is supported on your terminals and request a cost comparison
- For omnichannel businesses, ask your payment service provider if MCR is also supported for your online debit transactions
A simple change that can make a real difference
For many businesses, managing payment costs doesn’t require new technology or major system changes – just using what you already have more efficiently.
MCR is a proven, practical step that can deliver immediate savings, while supporting competition and resilience in Australia’s payment system.
And at a time when every dollar matters, it’s one of the easiest wins available for businesses in Australia.
Talk to your bank or payment service provider to learn more about how eftpos can work for your business.
Sources:
1Retail Payments statistics, RBA January 2026
2The Effect of Least-cost Routing on Merchant Payment Costs | Bulletin, RBA April 2024. Savings vary by merchant and transaction mix.
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