THE Australian Small Business and Family Enterprise Ombudsman has supported a parliamentary committee recommendation for banks to reduce “tap and go” transaction fees.
The House of Representatives Standing Committee on Economics recommended banks let merchants send tap-and-go payments from debit cards through eftpos instead of credit.
The committee said if banks have not done this by April 1, 2018, regulatory action should be taken.
Ombudsman Kate Carnell welcomed the recommendation.
“The average total merchant fee for a debit transaction is 0.26pc with eftpos and 0.58pc with Visa or Mastercard and it’s higher for small businesses,” Ms Carnell said.
“Shoppers are not given a choice with pay wave, as banks do not allow merchants to choose the route through which contactless payments are processed.
“It’s estimated that processing tap-and-go transactions through credit cards instead of eftpos costs businesses $290m a year.”
Ms Carnell said she was encouraged that ANZ told the committee they would give merchants a choice and said she looked forward to seeing timelines for implementation.
“Consumers and small businesses are being exploited for utilising the convenience of tap-and-go,” Ms Carnell said.
“Small businesses are unwilling tax collectors for banks and international credit card companies.
“They do not have the negotiating power of big business to get special deals.
“As we move towards a cashless economy, it’s vital that transaction fees are kept as low as possible.”
