RBA wants to ban credit and debit surcharges
On Tuesday, the RBA released its review into card surcharges, proposing a suite of reforms aimed at lowering fees for both consumers and merchants, including a lever to force credit card companies and financial players – involved higher up the payments chain – to publish details of the fees they impose on businesses.
The RBA's proposal to stop fees on credit and debit card transactions, which will now be subject to an industry consultation window, goes further than reforms the Albanese government had flagged last year, when it said it wanted to ban surcharges on debit cards.
For years, businesses have been able to apply surcharges to credit and debit card payments, but the amount is not supposed to exceed what it costs a business to process the payment. While average surcharges have been about 0.7 per cent of a transaction, they have ranged between 0.1 per cent to 10 per cent.
In its preliminary view, the RBA has proposed banning all surcharges for consumers using Eftpos, Visa and Mastercard – applying its rules to American Express would rely on separate reforms to the payments act currently on the horizon – noting 'surcharging is no longer achieving its intended purpose of steering consumers to make more efficient payment choices'.
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'Avoiding surcharges has become harder as cash usage has declined. Businesses are increasingly charging the same surcharge rate across debit and credit cards and there are significant challenges,' the RBA said.
The RBA took the decision to include credit cards in the surcharge ban after feedback from its initial issues paper released in October, where payment service providers estimated the cost of banning surcharges for just debit cards would be more costly, take more time and would be more confusing to implement than a blanket ban.
In extending credit cards in the surcharge ban proposal, the RBA has also announced lower fees and greater transparency measures for businesses. These include lowering the cap on interchange fees that businesses have to pay payment service providers (including fintechs such as Square), as well as banks that provide terminal technology.
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The Advertiser
an hour ago
- The Advertiser
Lake council demands support in Eraring closure to prevent economic 'death by a thousand cuts'
FAILING to prepare for Eraring's closure could hit Lake Macquarie's economy with "death by a thousand cuts", one of the city's councillors fears. Councillors voted unanimously at an extraordinary meeting on Monday night to write to the federal Net Zero Economy Authority to deliver a jobs transition plan to soften the blow of the loss of some 1800 jobs and $4.5 billion from the local economy when Eraring power station closes. "We need certainty," Liberal deputy mayor Jack Antcliff said. "We are not a city with a BHP, or a Ford or Holden (plant), we are a city of thousands of small businesses and a city where an economic change is a death by a thousand cuts." "We don't want to get 15 years down the road and wonder where all those jobs went." Councillors and mayor Adam Shultz, who called the meeting, expressed concern that a poorly-managed transition would not only mire energy workers in uncertainty and job losses, but cripple the region's economy. West Ward councillor Jason Pauling, who likened the eventual wind-down of Eraring to the closure of the BHP steelworks in 1997, said it was incumbent on the federal government to "take responsibility for the industries it is looking to destroy". "We have a right to ask, and to demand, that opportunities are given to these job holders who will be affected," he said. The proposed jobs plan, if approved by the authority and the Fair Work Commission, would effectively require the power station to support employees to find new jobs as it winds down, and for six months after the station closes. Cr Shultz argued earlier this week that direct intervention was needed to soften the blow to the region when the station eventually closed. He said support needed to extend to supply and auxiliary industries that relied on Eraring for trade, making up some 15 per cent of the local economy. "Local businesses are really going to feel an impact, and hence why the federal government needs to step in and provide that additional support," he told the Newcastle Herald on Friday. Last month, Authority boss David Shankey said the department was seeking clarification on whether the coal-fired power station would actually close as scheduled in August 2027, or keep operating beyond that date. The state government agreed last year to underwrite a two-year extension of the plant through to August 2027. However, it is possible the plant could continue running through to 2029. "The Authority's consultation process for Eraring is based on the closure date that Origin has provided to the Australian Energy Market Operator, which is August 2027," an Authority spokeswoman told the Herald Tuesday. "Any extensions to the date are a matter for Origin and we are not aware of any requests for extension to this date." During the meeting, the council acknowledged efforts by the station's operator, Origin, to support workers but agreed direct government support was needed to ensure the region's security into the future. "We must be realistic about this change," Cr Antcliff said. "This is a small step for us, but it is an important step as we push to federal government (to acknowledge) that Lake Macquarie is part of it; it was part of it in the 1980s when they built the plant, it has been powering the state for a long time, and this region deserves to power the state in different ways into the future." The energy workers' union, which has also confirmed it would pressure the federal government to approve a jobs plan for Lake Macquarie, told the Herald last week that workers were facing "deep uncertainty" about Eraring's eventual closure, but that a jobs plan was a "real opportunity to do things differently and meet its commitment of leaving no one behind in the energy transition". FAILING to prepare for Eraring's closure could hit Lake Macquarie's economy with "death by a thousand cuts", one of the city's councillors fears. Councillors voted unanimously at an extraordinary meeting on Monday night to write to the federal Net Zero Economy Authority to deliver a jobs transition plan to soften the blow of the loss of some 1800 jobs and $4.5 billion from the local economy when Eraring power station closes. "We need certainty," Liberal deputy mayor Jack Antcliff said. "We are not a city with a BHP, or a Ford or Holden (plant), we are a city of thousands of small businesses and a city where an economic change is a death by a thousand cuts." "We don't want to get 15 years down the road and wonder where all those jobs went." Councillors and mayor Adam Shultz, who called the meeting, expressed concern that a poorly-managed transition would not only mire energy workers in uncertainty and job losses, but cripple the region's economy. West Ward councillor Jason Pauling, who likened the eventual wind-down of Eraring to the closure of the BHP steelworks in 1997, said it was incumbent on the federal government to "take responsibility for the industries it is looking to destroy". "We have a right to ask, and to demand, that opportunities are given to these job holders who will be affected," he said. The proposed jobs plan, if approved by the authority and the Fair Work Commission, would effectively require the power station to support employees to find new jobs as it winds down, and for six months after the station closes. Cr Shultz argued earlier this week that direct intervention was needed to soften the blow to the region when the station eventually closed. He said support needed to extend to supply and auxiliary industries that relied on Eraring for trade, making up some 15 per cent of the local economy. "Local businesses are really going to feel an impact, and hence why the federal government needs to step in and provide that additional support," he told the Newcastle Herald on Friday. Last month, Authority boss David Shankey said the department was seeking clarification on whether the coal-fired power station would actually close as scheduled in August 2027, or keep operating beyond that date. The state government agreed last year to underwrite a two-year extension of the plant through to August 2027. However, it is possible the plant could continue running through to 2029. "The Authority's consultation process for Eraring is based on the closure date that Origin has provided to the Australian Energy Market Operator, which is August 2027," an Authority spokeswoman told the Herald Tuesday. "Any extensions to the date are a matter for Origin and we are not aware of any requests for extension to this date." During the meeting, the council acknowledged efforts by the station's operator, Origin, to support workers but agreed direct government support was needed to ensure the region's security into the future. "We must be realistic about this change," Cr Antcliff said. "This is a small step for us, but it is an important step as we push to federal government (to acknowledge) that Lake Macquarie is part of it; it was part of it in the 1980s when they built the plant, it has been powering the state for a long time, and this region deserves to power the state in different ways into the future." The energy workers' union, which has also confirmed it would pressure the federal government to approve a jobs plan for Lake Macquarie, told the Herald last week that workers were facing "deep uncertainty" about Eraring's eventual closure, but that a jobs plan was a "real opportunity to do things differently and meet its commitment of leaving no one behind in the energy transition". FAILING to prepare for Eraring's closure could hit Lake Macquarie's economy with "death by a thousand cuts", one of the city's councillors fears. Councillors voted unanimously at an extraordinary meeting on Monday night to write to the federal Net Zero Economy Authority to deliver a jobs transition plan to soften the blow of the loss of some 1800 jobs and $4.5 billion from the local economy when Eraring power station closes. "We need certainty," Liberal deputy mayor Jack Antcliff said. "We are not a city with a BHP, or a Ford or Holden (plant), we are a city of thousands of small businesses and a city where an economic change is a death by a thousand cuts." "We don't want to get 15 years down the road and wonder where all those jobs went." Councillors and mayor Adam Shultz, who called the meeting, expressed concern that a poorly-managed transition would not only mire energy workers in uncertainty and job losses, but cripple the region's economy. West Ward councillor Jason Pauling, who likened the eventual wind-down of Eraring to the closure of the BHP steelworks in 1997, said it was incumbent on the federal government to "take responsibility for the industries it is looking to destroy". "We have a right to ask, and to demand, that opportunities are given to these job holders who will be affected," he said. The proposed jobs plan, if approved by the authority and the Fair Work Commission, would effectively require the power station to support employees to find new jobs as it winds down, and for six months after the station closes. Cr Shultz argued earlier this week that direct intervention was needed to soften the blow to the region when the station eventually closed. He said support needed to extend to supply and auxiliary industries that relied on Eraring for trade, making up some 15 per cent of the local economy. "Local businesses are really going to feel an impact, and hence why the federal government needs to step in and provide that additional support," he told the Newcastle Herald on Friday. Last month, Authority boss David Shankey said the department was seeking clarification on whether the coal-fired power station would actually close as scheduled in August 2027, or keep operating beyond that date. The state government agreed last year to underwrite a two-year extension of the plant through to August 2027. However, it is possible the plant could continue running through to 2029. "The Authority's consultation process for Eraring is based on the closure date that Origin has provided to the Australian Energy Market Operator, which is August 2027," an Authority spokeswoman told the Herald Tuesday. "Any extensions to the date are a matter for Origin and we are not aware of any requests for extension to this date." During the meeting, the council acknowledged efforts by the station's operator, Origin, to support workers but agreed direct government support was needed to ensure the region's security into the future. "We must be realistic about this change," Cr Antcliff said. "This is a small step for us, but it is an important step as we push to federal government (to acknowledge) that Lake Macquarie is part of it; it was part of it in the 1980s when they built the plant, it has been powering the state for a long time, and this region deserves to power the state in different ways into the future." The energy workers' union, which has also confirmed it would pressure the federal government to approve a jobs plan for Lake Macquarie, told the Herald last week that workers were facing "deep uncertainty" about Eraring's eventual closure, but that a jobs plan was a "real opportunity to do things differently and meet its commitment of leaving no one behind in the energy transition". FAILING to prepare for Eraring's closure could hit Lake Macquarie's economy with "death by a thousand cuts", one of the city's councillors fears. Councillors voted unanimously at an extraordinary meeting on Monday night to write to the federal Net Zero Economy Authority to deliver a jobs transition plan to soften the blow of the loss of some 1800 jobs and $4.5 billion from the local economy when Eraring power station closes. "We need certainty," Liberal deputy mayor Jack Antcliff said. "We are not a city with a BHP, or a Ford or Holden (plant), we are a city of thousands of small businesses and a city where an economic change is a death by a thousand cuts." "We don't want to get 15 years down the road and wonder where all those jobs went." Councillors and mayor Adam Shultz, who called the meeting, expressed concern that a poorly-managed transition would not only mire energy workers in uncertainty and job losses, but cripple the region's economy. West Ward councillor Jason Pauling, who likened the eventual wind-down of Eraring to the closure of the BHP steelworks in 1997, said it was incumbent on the federal government to "take responsibility for the industries it is looking to destroy". "We have a right to ask, and to demand, that opportunities are given to these job holders who will be affected," he said. The proposed jobs plan, if approved by the authority and the Fair Work Commission, would effectively require the power station to support employees to find new jobs as it winds down, and for six months after the station closes. Cr Shultz argued earlier this week that direct intervention was needed to soften the blow to the region when the station eventually closed. He said support needed to extend to supply and auxiliary industries that relied on Eraring for trade, making up some 15 per cent of the local economy. "Local businesses are really going to feel an impact, and hence why the federal government needs to step in and provide that additional support," he told the Newcastle Herald on Friday. Last month, Authority boss David Shankey said the department was seeking clarification on whether the coal-fired power station would actually close as scheduled in August 2027, or keep operating beyond that date. The state government agreed last year to underwrite a two-year extension of the plant through to August 2027. However, it is possible the plant could continue running through to 2029. "The Authority's consultation process for Eraring is based on the closure date that Origin has provided to the Australian Energy Market Operator, which is August 2027," an Authority spokeswoman told the Herald Tuesday. "Any extensions to the date are a matter for Origin and we are not aware of any requests for extension to this date." During the meeting, the council acknowledged efforts by the station's operator, Origin, to support workers but agreed direct government support was needed to ensure the region's security into the future. "We must be realistic about this change," Cr Antcliff said. "This is a small step for us, but it is an important step as we push to federal government (to acknowledge) that Lake Macquarie is part of it; it was part of it in the 1980s when they built the plant, it has been powering the state for a long time, and this region deserves to power the state in different ways into the future." The energy workers' union, which has also confirmed it would pressure the federal government to approve a jobs plan for Lake Macquarie, told the Herald last week that workers were facing "deep uncertainty" about Eraring's eventual closure, but that a jobs plan was a "real opportunity to do things differently and meet its commitment of leaving no one behind in the energy transition".
Sky News AU
an hour ago
- Sky News AU
COSBOA warns against RBA's call to ban credit and debit card surcharges, arguing the change 'doesn't solve' underlying problem
The Reserve Bank of Australia's push to ban credit and debit card surcharges 'doesn't solve' the underlying problem surrounding the fees, a small business leader has warned as debate rages over the payments. The central bank on Tuesday revealed a three-tiered approach to tackling surcharges: Banning customer surcharges, capping interchange fees (which are paid by businesses to shoppers' banks) and provide greater transparency around the fees. Businesses will be able to shop around for better deals if there is greater transparency, and removing interchange fees could save businesses $1.2b annually, the RBA estimates. The call received a mixed response from the Council of Small Business Organisations Australia chair Matthew Addison, who warned the complexities of card surcharging meant simply removing the fees for consumers could be counterproductive. 'We have a very opaque system. A lot of the costs are buried in the detail,' Mr Addison said on Business Now. 'We look forward to this consultation of the Reserve Bank (and) surfacing some of the better options. Banning surcharges alone doesn't solve it.' He also warned the 'surcharges aren't going anywhere' as the RBA promotes banning businesses from charging these additional costs to their customers. 'Hiding those costs by banning them simply puts them into the overheads or the operating costs of the small businesses,' Mr Addison said. 'Hiding the cost doesn't remove them.' COSBOA supported reductions to the interchange fee as it could save many businesses and consumers money. It also backed the RBA demanding further transparency over the costs and argued this could result in merchant service providers - which are companies that allow businesses to accept card payments - to pitch for businesses. 'If we can get more transparency and we can also get the merchant service providers actually pitching for the small business, (it gives) them a number of options,' Mr Addison said. ''Here's the plan you're on. Here's a plan that will actually save you some money'.' The RBA's call also met backlash from the Australian Restaurant & Cafe Association (ARCA) which labelled it a 'short-sighted, anti-small business policy' and argued it would force establishments to pass costs onto consumers. 'Who the hell does the RBA think will bear the cost of this ridiculous decision?' ARCA chief executive Wes Lambert said. 'First, merchants and then customers, through higher menu prices in the middle of a cost of living crisis. 'No matter how low merchant fees go based on the RBA's intention to save businesses $1.2 billion dollars, with no surcharging, businesses who previously paid net $0 in merchant fees, will now be faced with the bill.' The RBA will continue to seek feedback on the changes until late August before handing down a final proposal at the end of the year. Changes will be introduced from the beginning of next year and enforced from July 1. Major Australian banks and the Australian Banking Association have called for interchange fees not to be lowered as they help counteract fraud and cover chargeback rights – which allows banks to reverse certain payments. It comes as Treasurer Jim Chalmers last year vowed to ban debit card surcharges to ease cost of living pressures, but does not extend to credit card purchases. 'This is all about getting a better deal for consumers, reducing costs for small businesses and promoting a more competitive payments system,' Mr Chalmers said in October.
The Advertiser
an hour ago
- The Advertiser
Sweet and sour in Beijing: PM's China trip bears fruit
Sweet and tangy jujubes could soon be on the way to Australian shelves as part of a broadened trade pact with China. The agreement was one of six signed by Prime Minister Anthony Albanese and Chinese Premier Li Qiang on Tuesday as Australia and China sought to boost business links as US President Donald Trump upends the global trade order. Jujubes, a small apple-like fruit, will be exported to Australia while apples from the Australian mainland will be allowed to be exported to China for the first time. Another four memoranda of understanding were signed by the pair as Mr Albanese met the highest-ranking Chinese leaders - President Xi Jinping, Premier Li and Chairman Zhao Leji - in the centrepiece of his six-day visit to China. Australia and China must deepen economic co-operation given increasing trade frictions elsewhere, Mr Li said after a lavish welcome in Beijing's Great Hall of the People. "In recent years, co-operation has encountered headwinds," he said, adding that it was hard to find two countries with more complementary economies than Australia and China. His comments were echoed by Mr Albanese. "My government believes unequivocally in free and fair trade as a driver of global growth, and I know the discussions that we've had today have been very constructive," he said. But the relationship is not without its challenges. China has chafed at Australia's stringent foreign investment regime on Chinese firms. Mr Li said China would protect the rights of foreign businesses and treat them in accordance with the law, in an oblique reference to Australian plans to tear up a Chinese-owned company's lease of Darwin Port. "I trust Australia will treat Chinese enterprise fairly and properly resolve issues regarding market access and investment review," he told a gathering of Australian and Chinese business leaders. Mr Li and Mr Albanese also signed an agreement to kickstart a review of the 10-year-old free trade agreement between the two nations. Collaboration on steel decarbonisation, increasing tourism links and paperless certification of agriculture products were also broached at the meeting. The prime minister will visit the Great Wall on Wednesday before flying out to Chengdu in the southwestern province of Sichuan - known as the home of the giant panda. Sweet and tangy jujubes could soon be on the way to Australian shelves as part of a broadened trade pact with China. The agreement was one of six signed by Prime Minister Anthony Albanese and Chinese Premier Li Qiang on Tuesday as Australia and China sought to boost business links as US President Donald Trump upends the global trade order. Jujubes, a small apple-like fruit, will be exported to Australia while apples from the Australian mainland will be allowed to be exported to China for the first time. Another four memoranda of understanding were signed by the pair as Mr Albanese met the highest-ranking Chinese leaders - President Xi Jinping, Premier Li and Chairman Zhao Leji - in the centrepiece of his six-day visit to China. Australia and China must deepen economic co-operation given increasing trade frictions elsewhere, Mr Li said after a lavish welcome in Beijing's Great Hall of the People. "In recent years, co-operation has encountered headwinds," he said, adding that it was hard to find two countries with more complementary economies than Australia and China. His comments were echoed by Mr Albanese. "My government believes unequivocally in free and fair trade as a driver of global growth, and I know the discussions that we've had today have been very constructive," he said. But the relationship is not without its challenges. China has chafed at Australia's stringent foreign investment regime on Chinese firms. Mr Li said China would protect the rights of foreign businesses and treat them in accordance with the law, in an oblique reference to Australian plans to tear up a Chinese-owned company's lease of Darwin Port. "I trust Australia will treat Chinese enterprise fairly and properly resolve issues regarding market access and investment review," he told a gathering of Australian and Chinese business leaders. Mr Li and Mr Albanese also signed an agreement to kickstart a review of the 10-year-old free trade agreement between the two nations. Collaboration on steel decarbonisation, increasing tourism links and paperless certification of agriculture products were also broached at the meeting. The prime minister will visit the Great Wall on Wednesday before flying out to Chengdu in the southwestern province of Sichuan - known as the home of the giant panda. Sweet and tangy jujubes could soon be on the way to Australian shelves as part of a broadened trade pact with China. The agreement was one of six signed by Prime Minister Anthony Albanese and Chinese Premier Li Qiang on Tuesday as Australia and China sought to boost business links as US President Donald Trump upends the global trade order. Jujubes, a small apple-like fruit, will be exported to Australia while apples from the Australian mainland will be allowed to be exported to China for the first time. Another four memoranda of understanding were signed by the pair as Mr Albanese met the highest-ranking Chinese leaders - President Xi Jinping, Premier Li and Chairman Zhao Leji - in the centrepiece of his six-day visit to China. Australia and China must deepen economic co-operation given increasing trade frictions elsewhere, Mr Li said after a lavish welcome in Beijing's Great Hall of the People. "In recent years, co-operation has encountered headwinds," he said, adding that it was hard to find two countries with more complementary economies than Australia and China. His comments were echoed by Mr Albanese. "My government believes unequivocally in free and fair trade as a driver of global growth, and I know the discussions that we've had today have been very constructive," he said. But the relationship is not without its challenges. China has chafed at Australia's stringent foreign investment regime on Chinese firms. Mr Li said China would protect the rights of foreign businesses and treat them in accordance with the law, in an oblique reference to Australian plans to tear up a Chinese-owned company's lease of Darwin Port. "I trust Australia will treat Chinese enterprise fairly and properly resolve issues regarding market access and investment review," he told a gathering of Australian and Chinese business leaders. Mr Li and Mr Albanese also signed an agreement to kickstart a review of the 10-year-old free trade agreement between the two nations. Collaboration on steel decarbonisation, increasing tourism links and paperless certification of agriculture products were also broached at the meeting. The prime minister will visit the Great Wall on Wednesday before flying out to Chengdu in the southwestern province of Sichuan - known as the home of the giant panda. Sweet and tangy jujubes could soon be on the way to Australian shelves as part of a broadened trade pact with China. The agreement was one of six signed by Prime Minister Anthony Albanese and Chinese Premier Li Qiang on Tuesday as Australia and China sought to boost business links as US President Donald Trump upends the global trade order. Jujubes, a small apple-like fruit, will be exported to Australia while apples from the Australian mainland will be allowed to be exported to China for the first time. Another four memoranda of understanding were signed by the pair as Mr Albanese met the highest-ranking Chinese leaders - President Xi Jinping, Premier Li and Chairman Zhao Leji - in the centrepiece of his six-day visit to China. Australia and China must deepen economic co-operation given increasing trade frictions elsewhere, Mr Li said after a lavish welcome in Beijing's Great Hall of the People. "In recent years, co-operation has encountered headwinds," he said, adding that it was hard to find two countries with more complementary economies than Australia and China. His comments were echoed by Mr Albanese. "My government believes unequivocally in free and fair trade as a driver of global growth, and I know the discussions that we've had today have been very constructive," he said. But the relationship is not without its challenges. China has chafed at Australia's stringent foreign investment regime on Chinese firms. Mr Li said China would protect the rights of foreign businesses and treat them in accordance with the law, in an oblique reference to Australian plans to tear up a Chinese-owned company's lease of Darwin Port. "I trust Australia will treat Chinese enterprise fairly and properly resolve issues regarding market access and investment review," he told a gathering of Australian and Chinese business leaders. Mr Li and Mr Albanese also signed an agreement to kickstart a review of the 10-year-old free trade agreement between the two nations. Collaboration on steel decarbonisation, increasing tourism links and paperless certification of agriculture products were also broached at the meeting. The prime minister will visit the Great Wall on Wednesday before flying out to Chengdu in the southwestern province of Sichuan - known as the home of the giant panda.
