August 31st 2024.
Paying for everyday purchases with a credit card could soon become a more affordable experience, as bank executives are backing a proposal to eliminate credit card surcharges. While these small fees may seem insignificant at the time, financial experts warn that they can quickly add up - a concern that is amplified as Australians grapple with the rising cost of living.
Sally Tindall, a representative from Canstar, shed light on the issue, stating, "Some people are unknowingly spending a significant amount of money each year on these pesky fees." She also emphasized the need for more consistent and transparent rules surrounding surcharges.
Currently, the Reserve Bank sets caps on credit card surcharges, which are as follows: less than 0.5% for Eftpos transactions, between 0.5% and 1% for Visa and Mastercard debit cards, and between 1% and 1.5% for Visa and Mastercard credit cards. However, while the heads of the nation's largest banks support a ban on these fees, businesses are pushing back against the idea.
Wes Lambert, CEO of the Australian Restaurant and Café Association, expressed his concerns, saying, "A ban on surcharges would be disastrous for restaurants and cafes across the country." This sentiment was echoed by Prime Minister Anthony Albanese, who addressed the issue during a visit to Queensland. "Banks have a responsibility to prioritize the needs of their customers," he stated firmly. "If you treat your customers right, they will do the same for you."
With a federal election looming on the horizon, the cost of living remains a top concern for voters. Albanese acknowledged this, stating, "It's our duty to address this issue and it's something that I am fully committed to." However, the Treasurer has ruled out a large-scale spending spree to win over voters, as the government attempts to strike a balance between supporting those facing financial difficulties and minimizing inflation.
Tindall emphasized the importance of this approach, saying, "We still have a long way to go in the battle against inflation." She warned that a sudden increase in government spending could only add fuel to the fire and create further problems down the line. As the election draws nearer, it remains to be seen how the government will navigate this delicate issue.
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