RBA defends credit card surcharges

paypass, contactless, payment, POS, credit cardThe head of the Reserve Bank has defended credit card surcharges as helping to keep the price of goods and services down, but says review is needed.

While surcharging tends to be a “hot button issue” with consumers, the RBA considers its decision to allow surcharging in 2002 to have been a valuable reform, governor Glenn Stevens says.

Surcharging helps shop owners to keep their costs down and, therefore, help to hold down the prices of goods and services more generally, Stevens told a banking summit in Sydney on Tuesday.

But the RBA was considering potential changes to the regulation of card surcharges and interchange fees, having announced a review of card payments regulation in response to recommendations from David Murray’s Financial System Inquiry last year.

“Our current review will consider ways we can retain the considerable benefits of allowing merchants to surcharge, while addressing concerns about excessive surcharges,” Stevens said.

That might involve preventing surcharges for some payment methods like debit cards, as suggested in the FSI, he said.

“This would mean that, in most cases, consumers would have better access to a payment method that is not surcharged, even when transacting online,” he said.


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