'We Made the Wrong Decision': Payment Processor Reverses Hidden Fee After Outrage From Customers, Restaurant Owners Toast Inc. revealed the news in an email to customers on Wednesday.
By Emily Rella Edited by Jessica Thomas
Key Takeaways
- Restaurant management system Toast is removing a $0.99 fee for customers.
- The fee sparked outrage among restaurant owners, who claimed the company added it without their consent.
- It's expected to be waived by the end of the week.
Restaurant technology company Toast Inc. handed a major win to small businesses by announcing it will remove a $0.99 processing fee that has irked customers and restaurant owners nationwide.
Toast's technology is used to process orders and bills in restaurants and has been under fire from mom-and-pop restaurant owners. It came to light that Toast was adding a $.99 fee to customers' bills without the restaurant owners' consent.
"The Order Processing Fee is set by Toast to help provide affordable digital ordering services for local restaurants," the disclaimer on customer receipts reads. Restaurant owners claimed they didn't consent to the fee.
The fee, which is added to online orders of more than $10, will be removed by the end of the week, though some restaurants claim that they've already seen it waived.
"While we had the best of intentions — to keep costs low for our customers — that is not how the change was perceived by some of you," Toast CEO Chris Comparato wrote in an email to restaurant clients. "We made the wrong decision and following a careful review, including the additional feedback we received, the fee will be removed from our Toast digital ordering channels."
Related: South Park Creators Opening Restaurant After $40M Renovation
The email was also filed with the U.S. Securities and Exchange Commission.
Marketwatch reported that shares of Toast plummeted more than 10% early Wednesday morning after the news came out.
Last week, U.S. Rep. Mark Alford, R-Mo spoke on behalf of the House Committee on Small Business and said that the fee scandal was prompting a congressional inquiry.
"We are going full steam ahead with investigating the propriety of their way of doing business," he told FOX Business at the time.
Related: How a No-Tipping Policy Helped This Restaurant Triple Profits
It's estimated that more than 85,000 vendors use Toast.
