A newsagent in Western Australia received a lively and engaged response from Dr Mal Washer, federal member for Moore. Kudos to Dr Washer as this is a personal response and not a regurgitation of the spin from EPAL – the company controlled by the banks, Coles and Woolworths which is responsible for the soon to start new EFTPOS fee regime.
Dr Washer joins a small group of members of parliament who have taken time to listen, research and provide such a personal response. Read what Dr Washer wrote yesterday to a newsagent:
Further to your recent correspondence regarding changes to EFTPOS that will affect your small business.
The big banks and big retailers will gouge another $40 million out of small businesses and family enterprises unless bank charges are reduced to offset new EFTPOS transaction fees sanctioned by the Gillard Labor Government.
Australia’s big banks continue to promote EFTPOS as a convenient way for account holders to access their funds.
But changes approved by the Reserve Bank will see this convenience come with new merchant transaction fees to fund the new standalone business that now runs the popular EFTPOS debit payment system.
The Coalition has called on the big banks to reduce small business banking costs and fees by an amount equivalent to the new revenues created by ‘spinning off’ EFTPOS to ensure that the creation of the new business is not simply a ‘cost shift and double dip’.
The decision by the big banks and big retailers to move its jointly operated EFTPOS payment system into a separate business with new annual revenues in excess of $40 million, will add to small business and consumer costs while relieving the current owners of operating expenses.
Having decided that EFTPOS is now less a banking and payment channel created out of self interest and more a separate service others should pay to utilize, spinning off this activity should be accompanied by a cutting out of the banking costs that had previously underwritten its operation.
Unless the planned new transaction fees are fully offset by reductions in business banking fees, the creation of EFTPOS as a separate business will amount to an audacious cost shift and double dip.
A change to EFTPOS from an embedded business banking facility bundled into the banking service paid for by small businesses, to an explicit standalone service with its own transaction charges should rightly be accompanied by reductions in business banking fees and charges.
To not see a commensurate cost saving that offsets the new per-transaction EFTPOS fees will amount to a gouge on small businesses and consumers.
The Coalition understands the need for EFTPOS to be restructured to ensure that an Australian domestic, PIN debit product remains competitive and viable against the more expensive US-owned and more expensive MasterCard and Visa debit cards.
But clearly, the Gillard Labor Government has once again overlooked the impact of its decisions on small businesses and consumers. Under Labor small businesses are doing it tough. 300,000 jobs small business jobs have been lost under the Labor Government and the number of small business enterprises has actually declined by 18,500, particularly in the category of businesses employing 1 to 4 people, according to the latest ABS figures.
Without guaranteed offsets and savings to business banking fees and charges, setting up EFTPOS as a separate business will simply be a Gillard government endorsed further boost banking profits via another slug on cash-strapped small business and a further cost of living increase on consumers and households.
The Opposition has written to the Reserve Bank and banking regulator to seek assurances that transaction charge off-set conditions are a part of the EFTPOS licence approval and that small business banking fees will come down as a result of this popular payment channel being established as a separate business with its own merchant fee revenue.
Thank you for bringing this important issue to my attention.
Kind regards
Dr Mal Washer MP
Federal Member for Moore
I don;t quite see it as he writes. Both sides of parliament are responsible for the regime we have with EFTPOS. Both are responsible for delivering a fairer solution and demonstrating that they do care abut small business.
Click here for a copy of the briefing paper which the ANF has given permission to publish.
Click here for a copy of a letter developed by the ANF and which which you can personalise and send to your local member of parliament and senators for your state or territory.
Click here for a list of house of representatives members and here for a list of senators. With this information you can easily, call, email or write to your local parliamentarians and get them engaged on this issue.