Before considering whether your Organisation can pass fees onto parents, ensure you read up on local laws and regulations. In Australia, this is governed by the ACCC, and all information can be found here
When offering digital payments through Clipboard's integration with Stripe, schools incur processing fees. This article outlines legal and transparent methods to pass on these costs while maintaining compliance with relevant regulations.
Why Recoup Payment Processing Costs?
Payment processors like Stripe charge fees for each transaction. These typically include:
A percentage fee (e.g., 1.7% for domestic cards in Australia)
A fixed fee (e.g., AUD 30¢ per transaction in Australia)
Without a strategy to recoup these costs, schools must absorb them as operational expenses, which, if left unchecked, can impact Department budgets significantly over time.
Method: Building Fees into Base Price
The recommended approach for Clipboard schools using Payments is to incorporate their lowest cost processing fees directly into the base price of activities. This method is:
Legally compliant
Simple to implement without additional configuration
Transparent when properly communicated to parents
So long as there is minimal variation in costs across Stripe fees
How to Implement Fee Inclusion
Go to Activity Selection in Clipboard
When creating a new Activity Selection or editing an existing one:
Calculate the total cost including processing fees (base price + approximately 1.7% if that's the lowest fee)
Enter this as the Activity price
Clearly communicate in the Activity description that the price includes payment processing fees
Example Calculation
Let's assume an Activity is listed at exactly $100
Without fee recovery: If you charge exactly $100, the total fee (Clipboard + Stripe) will be 2.7% + 30¢ ($3.00), resulting in your school receiving only $97.00.
With fee recovery (baked-in approach):
Simply add 2.7% ($2.70) to the base cost to cover the percentage-based processing fees
Set the final price as $102.70
The processing fee will be 2.7%+ 30¢ of the new amount = $3.07
Your school receives $99.63
Comparison of approaches:
Without fee recovery:
Charge to parent: $100.00
School receives: $97.00
School covers: $3.00 in fees
With baked-in fee recovery:
Charge to parent: $102.70
School receives: $99.63
School covers: Only $0.37 in fees
Cost savings: $2.63 per $100 transaction
For a school processing $100,000 in Activity payments annually, this approach would save approximately $2,630 in processing fees.
Communication Template
We recommend checking your jurisdiction and, if necessary, including a small note to explain that the cost covers digital payment processing fees
Note: All Activity prices include a component to cover digital payment processing costs.
Important Considerations
Regulatory Compliance
In Australia, where Clipboard primarily operates, the ACCC regulates payment surcharges. The "baked-in" approach is compliant with these regulations as it applies a single, transparent price to all customers regardless of payment method.
International Cards
International cards typically incur higher processing fees (approximately 4.5%). Schools have several options:
Absorb the difference between domestic and international card fees
Set a higher base price that covers international card fees
Disable international card transactions if the cost differential is too significant
Reporting for Reconciliation
For financial reconciliation purposes:
Use Clipboard's reporting exports to track actual payment processing fees
These reports provide transparency on the exact costs incurred for each transaction
FAQ
Q: Can we set a global surcharge which appears on the invoice as a discreet line item?
A: No, Clipboard does not have the ability to pass on a surcharge as a direct line item. If you are interested in this feature, be sure to share your feedback in the Ideas Portal.
Q: Can we apply different fees based on card type?
A: The recommended approach in Clipboard is to use a single additional fee percentage which gets "baked in" to each Activity that covers your typical processing costs.
Q: Will parents see the breakdown of the fee component?
A: No, parents will only see the total price. We recommend transparency through clear communications about your pricing structure, in line with local legislation.
Q: How do we handle refunds?
A: When processing refunds, remember that payment processing fees are not refundable from Stripe. Consider this when determining your refund policy.
Need Additional Help?
If you have questions about implementing this approach or need assistance with financial reporting, please contact our support team at [email protected].