ACAPMA says the RBA’s Review of Merchant Card Payment Costs and Surcharging Consultation Paper which proposes a ban on card surcharges is a missed opportunity to overhaul the payments system.
The Consultation Paper fails to offer solutions to lower costs, increase transparency and competition, and promote competitive neutrality.
In its submission to the RBA in October 2024, ACAPMA called for ACAPMA proposed a suite of measures designed to reduce merchant costs without sacrificing flexibility:
1 – Mandatory Transparency Reporting
ACAPMA recommends legislative measures requiring acquirers and payment service providers to disclose detailed breakdowns of costs—interchange, PSP fees, and scheme fees. The RBA or ACCC would then publish such data (akin to petrol price transparency) to enable easier comparison.
2 – Simplified Fee Summaries in Contracts
All new or renewed merchant contracts should include a clear, standardised summary of total debit and credit card fees—similar to financial comparison rates—so that businesses can readily understand and compare deals.
3 – Mandated Dynamic Least-Cost Routing (LCR)
ACAPMA urges the RBA to require implementation of dynamic LCR for debit cards by January 1, 2026. This would allow automatic routing of transactions through the most economical network at the point of sale, rather than relying on static routing which often forces payments through costlier credit-card networks.
The additional mandating of Dynamic LCR would provide Australian Consumers with a ‘guarantee’ that they are paying the least cost for their purchase based upon the card they are using – instead of incurring a ‘penalty’ as a result of the merchant having not selected the merchant fee offering that provides the least cost for electronic transactions.
The Consultation Paper demonstrates a failure to understand the realities facing small businesses. Sectors such as petrol and convenience operate on slim margins and the RBA should be looking at ways to reduce the cost of doing business, not increasing costs or forcing businesses to pass on increased costs in the form of higher prices.
The RBA is accepting submissions from interested stakeholders until 26 August 2025 with a view to have the reforms being implemented from 1 July 2026. ACAPMA will be making a submission on behalf of our members. Members wishing to provide input to this process should email communications@acapma.com.au
ACAPMA
