The ANF has generously provided a letter for newsagents to use to lobby parliamentarians of the EFTPOS issue. Click here for a copy of the letter which you can personalise and send. I urge newsagent to engage with this. If the forecast changes proceed, we will face higher bank fees per EFTPOS transaction than major Coles and Woolworths. This will further erode consumer perception of newsagents and other smaller and independent retailers who compete with these two retail giants.
The ANF is lobbying from their end. Tyro, the Broadband EFTPOS company is lobbying from their end. Please engage in this campaign. The more newsagents who write the better.
Here is further background on this issue:
Eftpos Payments Australia Limited, EPAL, has been given the authority to set a multilateral fee only limited to the cap of 12 cents.
EPAL members are:
- Australia and New Zealand Banking Group Limited
- Australian Settlements Limited
- Bank of Queensland Limited
- Bendigo and Adelaide Bank Limited
- Cashcard Limited
- Citigroup Pty Limited
- Commonwealth Bank of Australia
- Coles Group Limited
- Cuscal Limited
- Indue Limited
- National Australia Bank Limited
- Suncorp Metway Limited
- Westpac Banking Corporation
- Woolworths Limited
On 27 November 2009, the RBA varied the EFTPOS Standard, based on the advice of the PSB. The purpose of the variation is to promote competition and efficiency in the Australia payments system by making the regulation of multilateral interchange fees in the EFTPOS system more consistent with that of the scheme debit system. The varied EFTPOS Standard imposes a cap on the weighted average of multilateral interchange fees set by the newly established EFTPOS scheme (EPAL) of 12 cents paid to the issuer – the same as for scheme debit interchange fees. The variation of the EFTPOS Standard is expected to enhance the ability of the EFTPOS system to compete with the international debt card schemes. The varied EFTPOS standard does not change the way in which bilateral interchange fees are regulated. Bilateral interchange fees on purchase transaction will remain regulated between 4 and 5 cents paid to the acquirer.
Check out this link.
The bilateral interchange fee clause allows Coles and Woolworths to avoid the fee increase. The next step is for the banks to terminate bilateral agreements and move to the multilateral agreement. Then the acquiring side of the banks has to decide on whether it will pass through the interchange fee increase from the issuing side to the merchants. It would be strange to expect that the banks raise the fee to then absorb it And then the merchants have to decide on whether they pass through the increased costs to consumers via price increase, surcharge EFTPOS, reduce or eliminate EFTPOS acceptance or absorb the cost increase in their margins.
The lobbying by newsagents and other independent retailers has to mobilise media, politicians and associations so as to move the EPAL board members to revise their fee increase decision. It is untimely and unjustifiable to raise EFTPOS fees. The merchants carry most of the burden involved in upgrading the EFTPOS network for EMV (chip) and contactless. They should continue to benefit from the negative interchange fee.
In my view it is grossly unfair that small retailers like newsagents are slugged with the fee to fund EFTPOS, when Woolworths and Coles are not.
Please engage in this campaign.
Excellent advice and help Mark. I am acting on this today. Come on others.
I have just emailed this letter to my local member and took the extra step of copying in my state member and relevant local councilors requestinfg that they help lobby against this unfair fee structure. I would urge others do do the same to create the greates possible groundswell against the fees.
below is what I said to those I cc’d in on the letter to my federal member.
Attached is a letter I forwarded to Ms Maria Vamvakinou MHR today.
As this effects every level of small business throughout the country, I feel strongly that all levels of government should be involved in lobbying against it.
Small business is in effect subsidising corporate retail business to compete further against us, weakening the financial position of some of the most important local employers in this market segment.
Your assistance in pointing out the inequity of this unfair fee structure would be valuable and I’m sure, appreciated buy all small businesses in your respective electorates as well as country wide.
I have written to my local member, I have a submission with the RBA and I have contacted the editors of papers, I think we all should do that small amount of work.
Excellent work Mark.
Lets call this for what it it.
Its an EFTPOS TAX on the AUSTRALIAN CONSUMER.
Can someone provide an example in laymans terms what this means? I’m thoroughly confused by issuer and acquirer etc.
This is probably wrong, but reading the last few posts on EFTPOS fees:
The issuer is the bank that issues the EFTPOS card to the customer.
The acquirer is the bank that puts money into the network i.e, the bank that gives you the EFTPOS terminal/merchant a/c.
The issuer gets paid 12c, the acquirer gets paid 5c. So the shop with the EFTPOS machine has to pay 17c per transaction (plus margin/proifit, as well as terminal leasing, a/c fees etc).
Sent to my member today.
I’ve copied in the Sunbury Businsses Association in an effort to bring wider attention to this matter. I suggest others who are being pro active to do the same with loca trader groups. The more noise the better.
…also; just did a walk around Seymour and handed a copy of the letter to every small business with my email address on it. I will then forward an email copy so they can edit and forward to Cindy McLeish MP.
Blake, there has been a credit paid on EFTPOS and this is about to disappear. All businesses except Coles and Woolies miss out.
Thank you for sharing the proforma.
Sent.
Thanks for this.