01.Reserve Bank reforms surcharges
From 1 January 2013 retailers will only be able to pass on the reasonable cost of card acceptance.
This will rule out payment surcharge being used as an avenue for revenue raising. The people’s watchdog has also welcomed the RBA’s announcement that it will look to bring greater transparency to surcharges by publishing more detailed data about the costs of processing credit cards.
The announcement by the Reserve Bank is a welcome consumer reform that will bring an end to excessive credit card surcharges.
What was the problem?
CHOICE has been increasingly concerned that some merchants have been cost-shifting, using payment surcharges as a means to raise additional revenue, and in 2010 conducted a joint investigation into surcharging with NSW Fair Trading. More recently, CHOICE estimated that Qantas may be charging consumers around $100m more in surcharges than they would pay to their bank to process these transactions.
What does CHOICE want?
CHOICE is now calling on those businesses with the most conspicuous surcharges, such as Qantas and Cabcharge, to justify how these meet the test of reasonable costs. CHOICE will also play a watchdog role, gathering experiences from Australian consumers to put pressure on businesses with excessive surcharges.
Read more about CHOICE's position on credit card surcharges, including the submission to the RBA enquiry.