Overview
- The card networks have made it illegal to add a separate surcharge for eftpos, Visa and Mastercard payments from 1 October, with American Express and UnionPay applying the rule from the same date and PayPal following on 5 October.
- The Reserve Bank has cut the maximum interchange fee to 0.30% from 0.80%, a change the RBA says will save businesses about $660 million a year while the government projects annual consumer savings of $1.6 billion and business savings of $910 million.
- Major banks and card issuers have already reduced rewards, cut perks and adjusted fees to recover lost interchange revenue, with customers warned to expect lower points earn rates and some higher card costs.
- Many small merchants remain poorly prepared and say they will either absorb processing costs or raise shelf prices, with cafés and independent retailers warning that thin profit margins make absorption difficult.
- Enforcement falls to card networks and payment providers rather than the RBA or ACCC, which creates operational challenges for varied terminals and contracts and gives consumers routes to report breaches to networks or the ACCC.