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Reserve Bank consultation on card fees

Following the federal government’s announcement about debit card fees, the reserve bank today announced details of its consultation on card fees. The issues paper provides good background on the move:

The Reserve Bank of Australia (RBA) is conducting a review of merchants’ card payment costs and surcharging. Australians use cards extensively to pay for goods and services and benefit from the convenience and security provided by card payments. However, in an environment of heightened concern around the cost of living and ongoing changes in payment preferences, merchants and consumers are increasingly focused on card payment costs and surcharging. These two issues are linked as merchants would be less likely to surcharge consumers if card payment costs were lower. Accordingly, it is timely to review whether the RBA could do more to put downward pressure on merchant card payment costs by promoting competition and efficiency and whether the RBA’s surcharging framework remains fit for purpose. This review also recognises that some years have now passed since the surcharging framework was introduced.

Retailers have an opportunity here to have their say in relation to payments. Take your time to read the issues paper and understand the extent of this first phase of a bigger project.

The RBA is seeking views from interested stakeholders on the issues raised in this paper. Written submissions on the issues discussed in Section 2 should be provided by 3 December 2024 to: pysubmissions@rba.gov.au

This is a hot topic for retailers and consumers. Having your say puts you into the conversation.

While associations, groups and other collectives will lodge submissions, my experience with government enquiries is that they appreciate hearing from individuals, or in this case, individual businesses.

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  1. Dianne Way

    The application of credit card charges in Australia has become ridiculous. Most merchants dont even attempt to inform customer of the fees believing it is their right to recover bank fees charged to them. However many merchants are not only claiming the fees leverage on them but more thus making a profit. Secondly the claim of ‘banks charge us and we just pass it on’ does not take into account the savings the merchant is making in reduction of staff as people touching to pay is much faster than cash, has less risk of theft, lower insurance costs and reduces labour in form of staff member needing to stand in a bank queue to deposit money. If we are to accept this is a cost pass on why don’t they charge us for electricity used in the shop. All costs should be built into the item, no hidden and variable addons. I just paid for a doctor telehealth and I was told it would be $55 no mention by person taking payment over phone of surcharge and yet on my statement I have been charged. This is very typical. Ban all surcharges and make cost recovery of all items be included in the shown price.

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  2. Mark Fletcher

    Dianne I agree with your claim Most merchants don’t even attempt to inform customer of the fees. There are regulations around surcharges, including informing customers. Most retailers I visit do this.

    Some retailers can’t easily pass on costs like a surcharge as they sell items that have a fixed price set by their supplier.

    When you make 12% or less gross profit on an item, as many newsagents do, there is little room for overheads.

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