The Australian Association of Convenience Stores (AACS) has warned shoppers will ultimately pay more for products after the Reserve Bank of Australia (RBA) announced a half baked ban on card surcharges but gave the big banks and international card companies permission to simply move the fees to behind the scenes.
AACS CEO Theo Foukkare said the RBA’s failure will result in Australian small businesses and their customers handing over even more money to the banks and overseas card companies and would undoubtedly drive up prices for everyday essentials.
“It’s a great headline for the RBA but the devil is in the detail and the detail is demonic,” Mr Foukkare said.
“This RBA decision fails a fundamental test — to deliver real cost relief for consumers — and instead risks embedding higher prices across the economy.
“Without banning the banks from demanding excessive fees for the interchange and other back-end tech, the RBA has just shifted the cost from the being passed on as a surcharge to recover costs and given the banks permission to hide their disproportionate fees behind the scenes.
“If retailers can’t recover the cost of expensive payment methods at the point of sale, those costs don’t disappear, they get baked into prices,” Mr Foukkare said.
“The RBA has handed a sweet deal to the big bank ad and slapped Aussies with another price hike in everyday essentials — whether it’s fuel, food-to-go or groceries — and every customer will end up paying more, regardless of if they’re using tap and go or paying with cash.
Mr Foukkare said the decision comes at a time when cost of living pressures remain, and small businesses are already absorbing significant increases in energy, rent, transport and compliance fees.
“This is not reform — it’s cost shifting.
Removing visibility of fees doesn’t eliminate them, it simply hides them and spreads them across the entire economy.
It’s bloody wrong,” Mr Foukkare said.
Industry analysis suggests the decision could result in billions of dollars in additional costs being passed through to consumers via higher prices, further fuelling inflationary pressures.
“We need real action — lower interchange fees, greater transparency, and mandated dynamic least cost routing — not policies that simply mask the problem.”
“AACS will continue to advocate for a fair, transparent payments system that supports both Aussie consumers and small businesses” he said.
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