Latest news with #AustralianPaymentsPlus
Sky News AU
15-07-2025
- Business
- Sky News AU
Reserve Bank of Australia calls for end to debit, credit card surcharges costing Aussie shoppers $1.2 billion annually
The Reserve Bank of Australia has called for surcharges on eftpos, Mastercard and Visa cards to be scrapped in a move that could save shoppers $1.2 billion each year. The central bank on Tuesday revealed a three-tiered approach to tackling niggly debit and credit card surcharges that ping consumers. Alongside demanding an end to surcharging, the RBA also called for the cap on interchange fees, which are paid by businesses to shoppers' banks, and demanded greater transparency around these fees. The latter, the RBA said, will make it easier for businesses to shop around for better-value payment deals. Removing interchange fees could save businesses $1.2b annually and about 90 per cent of local businesses are estimated to be better off under the central bank's proposal, according to the RBA. It would 'benefit small businesses the most' as they generally pay higher interchange fees. The RBA's call, however, was met with 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.' Similarly, the Council of Small Business Organisations Australia said the proposal was a 'mixed bag' as it welcomed reforms to transparency and fee reductions but warned there were 'serious unintended consequences by eliminating the right to surcharge'. 'Removing surcharges doesn't remove all the cost, it simply hides it,' COSBOA chair Matthew Addison said. 'For small businesses already managing tight margins, this means those costs would have to be absorbed into base prices, making it harder for businesses to be transparent and for consumers to make informed choices.' Australian Payments Plus, which covers BPAY and eftpos in Australia, said it welcomed the RBA's submission and stressed a surcharge bank will 'simplify the payment experience for customers and bring consistency across the industry'. 'It also means merchants will need to absorb these costs, making efficient payment routing and competitive and transparent pricing more important than ever,' Australian Payments Plus chief payments and schemes officer Adrian Lovney said. 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.
Sky News AU
15-07-2025
- Business
- Sky News AU
RBA proposes removing surcharge fees costing Aussies $1.2bn
Australian consumers could stop paying $1.2bn in sneaky surcharge fees, following a simple change proposed by the Reserve Bank of Australia. A fresh consultation paper released by the RBA proposes the removal of surcharge fees for tapping a card on eftpos, MasterCard, and Visa payments. While this is a step further than the government's initial ban on fees for debit transactions, the RBA says it would bring the Australian payment market in line with the rest of the world. The central bank is looking to finalise consultation with industry by the end of the year and have surcharges removed by next July. RBA governor Michele Bullock said the payment landscape was always evolving, meaning it was critically important to keep pace and ensure Australia's remained safe, competitive, and efficient. 'We think the time has come to address some of these high costs and inefficiencies in the system,' Ms Bullock said. 'This could save consumers $1.2bn annually, simplify payments and boost competition.' Australian Payments Plus chief payments and schemes officer Adrian Lovney welcomed the RBA making a fit for purpose payments network. 'The proposed changes will simplify the payment experience for customers and bring consistency across the industry,' Mr Lovney said. 'But it also means merchants will need to absorb these costs, making efficient payment routing and competitive and transparent pricing more important than ever. 'The RBA has acknowledged any savings for customers would require businesses to absorb the costs.' Despite flagging savings, the RBA consultation papers show if businesses raise prices to compensate for the removal of surcharges it will add 0.1 per cent to inflation. 'Merchants that surcharge debit card payments would be faced with a choice of increasing their prices or absorbing their debit payment costs through reduced margins,' the RBA said. The central bank is proposing another two changes to Australia's card network, including lowering the cap on interchange fees in a move they say could save businesses $1.2bn a year. 'Around 90 per cent of Australian businesses are estimated to be better off under the proposed change,' the RBA says. Bitcoin soars past key milestoneKey decision to decide Australia's future 'The proposed reduction in interchange caps would benefit small businesses the most, as they tend to pay fees closer to the existing cap.' The RBA is also in consultation to require card networks and large acquirers to publish the fees they charge. 'Improving transparency and competition will help all players better under the fees they are charged and make it easier for businesses to shop around for a better deal,' the RBA consultation papers say. Originally published as RBA proposes removing surcharge fees costing Aussies $1.2bn
Finextra
09-07-2025
- Business
- Finextra
AusPayNet and AP+ launch consultation on future of Australian A2A payments
Australia's payment industry and its domestic payments provider have launched a public consultation on the future of account-to-account payments in the country. 0 Australian Payments Network (AusPayNet), the self-regulatory body for the payments industry, and payments provider Australian Payments Plus (AP+) are looking for feedback from stakeholders and end-users. The move comes shortly after the Reserve Bank of Australia called for more clarity in planning for the decommissioning of the Bulk Electronic Clearing System (Becs), arguing that the industry is yet to arrive at a shared vision of the desired features of account-to-account payments in Australia and that there has been insufficient industry coordination, planning and certainty regarding the transition. Australians rely on Becs for a wide range of critical payments, including welfare, pension, salary, and bill payments. AusPayNet and AP+ note that A2A payment systems can support these and a host of other consumer, business and government payments. Now, they hope the consultation identifies the current and future payment needs and expectations of the users of Australia's A2A payments systems, including consumers, businesses, government, financial institutions, payment service providers, and other key stakeholder groups. The RBA has welcomed he development, with assistant governor Brad Jones saying: "This consultation provides a broad range of stakeholders the chance to provide input into how the system can be modernised to meet the opportunities and challenges of the future, in the public interest." AP+ CEO Lynn Kraus adds: 'The insights and feedback we gather will inform the industry's strategic approach to account-to-account payments and ensure we're addressing the priorities and needs of all stakeholders.'
