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Retailers benefit from payment system reforms
Sydney, 28 October, 2009: The Australian Bankers’ Association (ABA) says that Australian retailers are big winners from retail payments reform in Australia.
Since 2002, merchants across Australia have seen the costs of accepting credit cards and charge cards fall.
The Reserve Bank’s Payments System Board recently noted:
“The aggregate net savings to merchants over 2008/09 from declines in merchant fees across all four schemes1 since the reforms were introduced is estimated at $1.2 billion or around 74 cents for every credit or charge card purchase over the year.”2
David Bell, Chief Executive of the ABA, said: “This massive saving has only been partially offset by previous Reserve Bank changes to EFTPOS interchange. And there is no prospect that any potential changes to EFTPOS interchange under the proposed new rules would offset the credit card savings.”
“Since the reforms were introduced, credit card interchange savings have more than offset any EFTPOS cost increases for merchants. This means that retailers should have reduced prices for their goods and services.”
“Rather than warning of higher prices, retailers should be publicly committing to passing on the full benefit they have had from payments reform by lowering prices at the cash register.”
In addition, some retailers are now surcharging consumers for making payments by credit cards – these surcharges can be higher than the cost of accepting the credit card.
The ABA was responding to yesterday’s media statement from the Australian Retailers Association3.
For further information:
Heather Wellard
Director, Public Relations
Phone: 02 8298 0411
Mobile: 0409 830 439
ENDS
[1] MasterCard, Visa, American Express, Diners Club. This footnote has been inserted by the ABA (not in the RBA document) to clarify which companies make up the ‘four schemes’.
[2] RBA Payments System Board Annual Report 2009, p14
[3] Media release 27 October 2009 – Retailers set to pay up $250 million more for EFTPOS transactions – ARA rejects need for interim EFTPOS fee standard |