Friday, May 16, 2014

Processing Credit Cards in Canada

On our recent visit to Canada, we got to experience the way that Canadian merchants handle credit card transactions. Essentially, for a credit card transaction, the clerk or waiter configures the charge, swipes your card, then hands you a portable credit card terminal. At this point, you can review the charges and, if you're at a restaurant, add the tip.

For me, the thing that I found most interesting was the tipping percentages. Some restaurants preconfigure the tip percentages. These preset values could be 15%, 18%, 20%, or even 25%. Often in the interface, you are provided options to enter other percentages or just a specific dollar amount.

Traditional restaurant etiquette suggest that a proper tip is 15-18% of the bill. For some accountants or particularly tight tippers, they may also calculate the tip based on the pre-tax dollar amount. But, often enough, because 15-18% calculations are a little difficult to make (and most restaurant service staff doesn't make much for wages beyond their tips), it's not uncommon to simply tip 20% because it's such an easy calculation.

So, as I used the Canadian credit card transaction system, the thing that kept running through my head was, if you can easily select 15% or 18% and have the calculations handled for you, are you more likely to select that lower number? And, on the average, does this system therefore suck for waiters in Canada?

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