Crackdown on credit card surcharges

The end of excessive credit card surcharges is on the horizon.
 
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01.Ending excessive surcharges

Excessive credit card surcharges

CHOICE has been calling for reasonable surcharges for years, and finally an end is in sight.

As of 18 March, surcharges applied to credit cards will be capped at a reasonable cost for the retailer – that is, on average, less than one per cent for Visa and MasterCard, and about two per cent for American Express and Diners Club cards.

This is a far cry from the 11% surcharge charged for using a credit card to pay a taxi fare, or the $17 fee applied for a single-sector return flight by Jetstar and Tiger Airways.

CHOICE has been on the case to have surcharges reined in for some time: in 2010 we partnered in a research project on excessive surcharges with NSW Fair Trading. The Reserve Bank of Australia (RBA) has taken notice of these concerns and launched a review in 2011, resulting in the current reforms.

We expect to see considerable reductions in excessive surcharges over the next few months. Although we probably won’t see an end to excessive surcharging by all retailers immediately, we should start seeing sharp reductions in over-inflated surcharges as the new rules take hold. 

But in the absence of any official regulator looking after the timely introduction of the reforms, it’s up to consumers to make it work. Join us in calling for reasonable surcharging and sign our petition for Cabcharge and the airlines to cut their surcharges. 

 
 

 

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