The Reserve Bank of Australia (RBA) has recommended surcharges be removed for payments made by credit cards.
A RBA consultation paper, released as part of its review of Merchant Card Payment Costs and Surcharging, states surcharging was no longer achieving its intended purpose of steering consumers to make more efficient payment choices.
In a statement, the RBA said it “would be in the public interest” to remove surcharging on eftpos, Mastercard and Visa cards.
“Consumers currently pay around $1.2 billion in card surcharges each year,” it said.
Th RBA said avoiding surcharges had become harder as cash usage declined, businesses were increasingly charging the same surcharge rate across debit and credit and there were significant challenges with enforcing the current surcharging rules.
“Removing surcharging would make card payments simpler, more transparent and help to increase competition in the card payments system.”
In other recommendations, the RBA suggested lowering the cap on interchange fees paid by businesses and requiring card networks and large acquirers to publish the fees they charged.
Feedback on the consultation paper is open until August 26.
