Australian Businesses Face Hefty Card Scheme Fees as Pressure Mounts for Transparency
Australian Businesses Face Hefty Card Scheme Fees as Pressure Mounts for Transparency
5
The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.
Rising service charges affecting Australian businesses have sharpened calls for increased transparency and regulation in the payment card industry.
The past financial year saw an alarming $1.9 billion in scheme fees burdening businesses and consumers, compelling calls for action from the Reserve Bank of Australia (RBA). Scheme fees, charged by payment networks such as MasterCard, Visa, and American Express, are applied whenever a bank processes card payments for a business and are also incurred to maintain the card provider's customer service.
These fees largely impact banks and, subsequently, their business clients who struggle with higher costs. Card providers frequently compete for lower scheme fees, transferring the financial burden to end-users through elevated prices on goods and services.
In the 12 months leading up to June 2023, these scheme fees, amounting to roughly $1.9 billion, were a substantial 43 percent increase from the previous financial year. This spike outpaced the 16 percent increase in card transactions during the same period.
Scheme fees are typically a percentage of the total transaction amount, although fees may also be levied based on the number of merchant outlets a bank services, regardless of transaction volume.
The unregulated growth of these charges has pushed RBA Governor Michele Bullock to consider regulatory intervention. Such measures could mandate transactions to default to the least costly card network, encouraging these networks to reduce their fees.
Ellis Connolly, head of payments policy at the RBA, cited that the bulk of this fee increase stems from a resurgence in international card transactions following the end of COVID-19 restrictions. He emphasized on Tuesday that the fees, though substantial and growing, are still "complex and opaque," reinforcing the need for increased transparency.
"There is notable variation in scheme fees among different card networks," Mr. Connolly mentioned during his address at the Merchant Risk Council Conference in Melbourne. He argued that greater fee transparency would aid merchants in understanding the costs and making more informed choices about which network to use for debit transactions.
However, Mr. Connolly admitted that efforts by the RBA to disclose specific fee data were thwarted. International card networks denied permission to publish details on their charges when prompted.
"We were unable to release information on individual network fees as international card networks declined our request for permission," he revealed.
Highlighting the ongoing quest for clarity, Mr. Connolly added, "We will bring the push for greater transparency over scheme fees into our upcoming review for further consultation."
Published:Wednesday, 19th Jun 2024 Source: Paige Estritori
Please Note: If this information affects you, seek advice from a licensed professional.
The Australian boating industry has demonstrated remarkable resilience, maintaining a steady turnover of $10.2 billion for the 2024-25 financial year. This figure, consistent with the previous year's record, underscores the sector's stability amidst evolving economic conditions. - read more
As the Australian boating industry approaches the 2025 summer season, recent data indicates a stabilising market with Yamaha retaining its position as the most-searched marine brand. According to Retain Media's Q3 2025 Marine Market Brand Consideration Report, Yamaha holds an 8.4% share of search interest, maintaining its lead despite a modest 7.6% quarterly decline. - read more
In a significant move for Australia's outdoor recreation sector, the Boating Industry Association (BIA) and the Australian Fishing Trade Association (AFTA) have formalised an agreement to collaborate more closely. This partnership is designed to benefit their combined membership base and bolster support for boat-based fishing across the nation. - read more
Ray White Marine made a significant impact at the 2025 Sydney International Boat Show, unveiling its largest and most valuable display to date-a $70 million lineup of luxury vessels at Darling Harbour. This showcase marked a milestone for the event, which transitioned to a summer schedule for the first time, transforming the harbor into a vibrant on-water playground from 13 to 16 November. - read more
The Boating Industry Association (BIA) has released its latest State of the Industry Data Report, revealing a noteworthy national turnover of $10.12 billion for the fiscal year 2023-24. This represents a 5% increase from the previous year, underscoring the sector's resilience and growth despite recent economic uncertainties. - read more
The Boating Industry Association Ltd (BIA) has recently called upon all levels of Australian government to provide strategic support to the nation's marine manufacturing and recreational boating sector. This appeal comes in response to a significant skills shortage that poses a threat to the industry's economic potential. - read more
Purchasing your dream boat brings with it a rush of excitement and a sense of freedom unparalleled by the confines of land. Whether you envision serene days sailing crystalline waters or action-packed fishing adventures, owning a boat provides an escape to a world of aquatic possibilities. As you prepare to navigate the open seas or tranquil lakes, it's crucial to consider not just the wind in your sails, but also the protection of your new vessel. - read more
Owning a boat is a dream for many Australians, offering an opportunity to explore the country's stunning waterways, enjoy recreational activities, and create lasting memories with family and friends. - read more
Welcome to the exciting world of boating! Owning a boat opens up a realm of adventures on the water, from leisurely cruises to thrilling water sports. - read more
As a boat owner, it's crucial to understand the importance of routine maintenance to keep your vessel in good condition. Neglecting maintenance can lead to costly repairs and unsafe conditions. - read more
Buying a used boat can be an exciting adventure, but it can also be a daunting task. It's important to remember that purchasing a high-quality used boat is crucial for your safety and enjoyment on the water. Australia's vast coastline and numerous waterways make it a prime location for boating enthusiasts, but with so many options available, it's easy to fall into common traps. - read more
Welcome! If you own a boat and are currently financing it, refinancing your boat loan might be a smart move to consider. But what exactly does refinancing mean? - read more
Start Here
Quotes are offered free & without obligation. We respect your privacy.
Knowledgebase
Personal Loan: A personal loan is a loan provided to an individual or individuals (as opposed to a business) and that can be generally be used for a variety of purposes subject to the approval of the lender.
