The Australian Retailers Association (ARA) has called on Australia's big banks to absorb new EFTPOS fees that will be rolled out from October 1, 2011.
EFTPOS Payments Australia Limited (EPAL), which operates the EFTPOS payment system, has announced a new “multilateral interchange fee” will replace its existing fee structure. Under the changes, retailers' merchants will be charged five cents when processing EFTPOS transactions of $15 or more. Transactions less than $15 will attract no fee.
The charges replace a previous model wherein retailers received a rebate of approximately five cents per transaction for using the EFTPOS system.
EPAL managing director Bruce Mansfield said the changes were designed to strengthen the competitiveness of EFTPOS payments in a market experiencing a growing number of alternative payment options, including the roll out of Visa and MasterCard debit cards.
“The new five cent interchange fee for standard point of sale transactions is less than half the equivalent fee of 12 cents payable for international scheme debit cards,” Mansfield said.
ARA executive director Russell Zimmermann called on Australia's banks to absorb the new EFTPOS fees rather than pass them on to retailers. He explained the previous 18 months of “poor” retail trade meant now was not the time to increase business costs for small retailers, including fashion boutiques.
“Keeping competition healthy between debit payment systems is important but the ARA is calling on banks to give smaller retailers a much needed break and do the right thing in absorbing costs related to the new EFTPOS interchange model,” Zimmermann said.
“Small retailers in particular should not be expected to cop increased interchange fees from banks that are posting giant profits, especially because they don't hold the same bargaining power as larger retailers when negotiating with their banks nor do they have the time and resources to try.”
EPAL reports EFTPOS payments currently account for 83 per cent of debit card payments in Australia. An estimated 4.5 million transactions are made through the EFTPOS system each day.