Rounding

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Consumer Protection often receives complaints about incorrect rounding of prices by retail and fast food outlets.

There are rules in place for businesses when it comes to dealing with small change transactions and we’d like to hear from customers who believe those rules are being broken.

In Australia we obviously only have five cent coin denominations which means cash prices are rounded up or down to the nearest five cents. For example:

  • 11 or 12 cents is rounded down to 10 cents;
  • 13 or 14 cents is rounded up to 15 cents;
  • 26 or 27 cents is rounded down to 25 cents; and
  • 28 or 29 cents is rounded up to 30 cents.

It is important to note rounding need only apply to cash sales. When you use a debit or credit card, the transaction is electronic and allows the processing of payments such as $9.99 so there is no need for the amount to be rounded up to $10.00. However, if you gave a 10 dollar note as cash payment you should not expect any change.

If an item is put on sale at $19.92 then only $19.90 should be taken as a cash payment. The amount of $19.92 can be charged if you pay by EFTPOS or credit card.

A major chain with outlets across Australia was recently reported to Consumer Protection for advertising a deal as $4.95 and rounding-up to $5.00. When you multiply the number of consumers likely to take up the offer with the extra five cents per transaction, the excess charge is significant. Rounding up by five cents is not acceptable and if the product costs 5 cents more than advertised, then the deal could be considered misleading under the Australian Consumer Law.

Another issue reported to us is that of multiple items being purchased and each item price rounded rather than the total price of all the goods. Rounding is a process to allow for customers to pay the correct ‘cash’ payment. All other transactions are simply charged as the exact amount.

If you believe you have been charged the wrong price for goods due to incorrect rounding talk to the seller in question; if possible at the till at the time of purchase. If you only realise after you have left the shop, restaurant, drive-through etc., go back and seek a refund. Should you have any trouble negotiating call Consumer Protection on 1300 304 054 or email consumer@dmirs.wa.gov.au.

Members of the community who believe a WA business is consistently rounding incorrectly, to the detriment of consumers, can report the matter to Consumer Protection for further investigation.

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