Credit card surcharge fees don't add up

[mgoska]

WE have been using Toast's credit card surcharging fees, but the amount we take in doesn't come close to offsetting the fees that they are taking.  Does anyone else see this problem?  We might need to start looking for other options.

[au79teahouse]

We don't use surcharge. But I'm curious about why the fees don't add up so I asked Toast IQ. The following is the response from Toast IQ:

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Credit card surcharge math can look “off” in Toast even when it’s working correctly—usually because Toast’s credit card surcharges don’t apply to everything you pay processing on (and they also don’t show up where people expect in reporting).

From Toast’s documentation, the biggest “doesn’t add up” reasons are:

What usually causes the mismatch

1. Surcharges apply only to credit cards (not debit/prepaid) Even if a guest runs a debit card “as credit,” it’s still debit/prepaid and cannot be surcharged per card brand rules.
   This is the #1 reason surcharge revenue is lower than expected.
   (Toast: Credit Card Surcharging FAQ)

2. Surcharges are calculated pre-tax and pre-tip If you’re mentally taking your surcharge rate × the final total (including tax/tip), your expected number will be too high.
   (Toast: Credit Card Surcharging FAQ)

3. You still pay processing fees on more than just “credit” Toast notes you’ll still pay card processing fees (and can’t fully offset them) because:

   • debit/prepaid can’t be surcharged
   • card-not-present channels may differ
   • processing fees still apply to the surcharge volume itself
     (Toast: Credit Card Surcharging FAQ)

4. Reporting placement can be confusing Toast states surcharge totals appear in Sales Summary as a separate line (“Credit Card Surcharges”) under Service Charge Summary, and also roll into “Non-Grat Svc Charges” (but not double-counted).
   (Toast: Credit Card Surcharging FAQ / Manage the Credit Card Surcharging Product)

Hope it helps.

[Pspizza1]

We have the same problem and have opened multiple cases regarding the issue. It sounds like Toast is a big part of the confusion. First, the majority of our sales are keyed-in transactions. Although Toast separates debit from credit transactions in tap/swipe, they apparently group all debit and credit keyed in transactions together. This makes it impossible to determine how many are credit that should be surcharged. Second, when we look at sales transaction details many of the credit transactions don’t have surcharges. We were told that is because Toast uses the term “credit” on the transaction as a generic term to distinguish it from a cash sale even if it is a debit transaction. That is just wrong in my opinion. If they want a generic term, use the word “charge” to differentiate from cash. Lastly, they do not have a report that will provide us with a true breakdown of credit and debit transactions and simply expect us to trust them that they are doing it accurately. 

We have found the surcharge option to be a joke. DO NOT PARTICIPATE IN THIS RIDICULOUS OPTION. We upset our guests that we are surcharging to offset our costs and only receive a pittance of the dollars actually charged. 

Toast should provide a real solution to this problem such as supporting dual pricing for cash and credit prices with a button on the payment screen that will allow for a cash discount at checkout. Toast’s current option to provide a cash discount requires a cashier to reopen a ticket and add a discount to the ticket before saving it and then going back to the payment screen to close out the transaction. It is confusing, unwieldy and time consuming. The bottom line is it isn’t practical to use this method at a busy restaurant. 

Toast has a lot of good things but when things don’t work or there is a problem it can take actual days of waiting on hold and creating dozens of cases to only possibly resolve it. Some things never get resolved. 

Right now we rate Toast a 1 out 10 and regret our choice to use them as a POS.