Reforms on credit card charges from March
THE Reserve Bank's decision to rein in credit card surcharges has been praised by consumer advocacy group CHOICE.
On Thursday the RBA said reforms to the amount banks could slug customers through surcharges would come into effect from March 18.
"The RBA is clearly saying that surcharges should be set at what retailers are paying their banks to accept card payments and that in most cases this should be around the level of the merchant service fee," CHOICE head of campaigns Matt Levey said.
"We know from the RBA's own data that retailers are being charged by their banks an average of around 0.87% for
MasterCard and Visa, 1.84% for American Express and 2.10% for Diners Club.1 "From March 18, 2013, consumers should expect to see surcharges limited to around these levels, and if they see anything much higher, they should tell their bank or card provider."
The RBA has also made special mention of the taxi industry, where Cabcharge's so-called 10% "fee on financial services" received a recent CHOICE Shonky Award.
The RBA noted the findings of the Taxi Industry Inquiry in Victoria, which estimated the total cost of accepting card payments in taxis at around 5%.
"Whether Cabcharge wants to call their 10% hit a 'surcharge' or a 'fee on financial services' or anything else, the writing is well and truly on the wall," says Mr Levey.
"It's time to stop slugging consumers with unjustified fees for using credit cards."