The Reserve Bank of Australia has ruled to cut credit card surcharges earlier this year – which could save consumers an estimated $350 million a year in extra fees. The biggest culprits, however, are resisting the change, saying their extra fees only cover the added costs.
The majority of Australian retailers do not tack on a surcharge on credit card payments – but about a third, or around 100,000 companies, levy an additional 2 to 4 percent of the transaction value. An RBA review found that only 23 per cent of small business tack on a charge, compared to 44 per cent of large retailers. Notorious examples exist as well, such as the 10 per cent surcharge levied on taxi fares paid with credit cards, as well as ‘flat’ fees charged by several airlines which often tack on a surcharge on cheap flights amounting to well over 20 percent of the ticket price. That is all likely to change this year.
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