Just adds to reason 1043213 why I hate living in Australia. We are counting down the days until we can live elsewhere
Except before you had by law an alternative, now you don't. If it said $99 before and you handed over $99 in cash then that was all you paid. Now the sign says $101 and handing over $99 in cash doesn't cut it anymore.
Personally I don't care whether or not surcharges exist in a market, I just prefer companies to be able to make the choice themselves as opposed to the government sticking its thumb on the scale. If a company wants to offer a more expensive payment method and make the user pay to use it while still offering the product for the advertised price for a payment method that is cheaper that's fine by me. The credit card company gets to choose its fees, the business gets to choose the surcharge (though I agree with rules not placing undue surcharge) and then customer gets to choose which payment method he wants to go with.
So you want to make everybody pay more 99% of the time to subsidise people who go out on a public holiday? Once again, the only reason that these surcharges exist is the government putting their thumb on the scale. I never used to pay a Sunday or a weekend surcharge, but when employers got forced to pay massive markups for their staffing costs on a Sunday they very quickly became ubiquitous. We're gone of the days where most Aussies hold Sunday to be sacred, but we force companies to pay as if it is. Personally I'd prefer to work a Sunday and get a weekday off every week.
If you think that the same number of businesses that currently have card surcharges are going to suddenly have cash / EFTPOS discounts then you're having a laugh.
AFAIK that same law also stipulated that a surcharge for card payments cannot be made if an alternative payment like cash or direct deposit etc was not made available. There were payment by card only businesses that still charge the surcharge (Avis being an example) regardless. I'm glad that greed is finally blanket banned. Unfortunately, this RBA change (reversion to what was before it approved the stampede causing surcharge bandwagon in 2003) does not cover payments by Amex and any other non bank issued cards so expect those will continue post 1 Oct, as was the case before 1 Jan 2003 except the hike in the Amex surcharge % will not likely revert. Not sure what the situation will be for bank issued Amex then.
How the heck do you propose they will pay less? Most people will pay the same, effectively nobody will pay less and people who pay exclusively with cash (you know, generally older people who are on a lower income) will indeed pay more.
The price remains the same if you pay by the most expensive payment method, it goes up if you pay with a less expensive method. If you cannot charge more for the more expensive method then you have to assume that will be the method people will pay with and charge accordingly.
A law I agree with. There should be a method to pay the advertised price.
Then the government should go after them and force them to offer a payment method at the advertised cost.
Greed is about as innately human as it comes, it can never be banned.
This is in no way a reversion to pre-2003 though. Pre-2003 surcharges were absolutely legal, they were simply forbidden by the card payment networks. In 2003 the RBA forbid Mastercard and Visa from having that clause in their contracts which lead to businesses making surcharges. Now surcharges are being banned at the legal level and the government is price fixing the interchange fees. A pre-2003 system would be much better for most of us than this change.
That assumes that companies will flatten out the existing surcharge spend across all customer, which assumes that people will use the same payment method regardless of the surcharges. I don't think either of those will happen. Without a surcharge people will naturally flock to the more expensive methods. I've regularly brought cash to the lovely Japanese restaurant near my place to avoid paying a surcharge, why would I do that when it makes me worse off vs paying by card?
It's the tragedy of the commons unfortunately. If the cost is spread amongst all users then people will inevitably use more and be more "wasteful" than if they personally bear the cost.
That definitely depends on the part of the market you are in. I would not be surprised if most of the places that people pay surcharges (mainly hospitality) pass the fee on in full for all payments.
I would argue that in the current system they have the ability to decide if the convenience is worth paying extra and they choose paying less rather than convenience. I am often the same.
I could not agree more, 100%! And let’s not forget, the cc surcharge nonsense is mostly an exclusive AU/NZ issue, “strangely” it’s not needed elsewhere in the world. I suspect competition will sort this out over time but that’ll take 5 years or so of pain in the interim.
Because the merchant interchange fees that banks can charge are also being capped (this is what's impacting the credit card reward programs, not the surcharge ban itself). The RBA is doing 2 things at once and many people are incorrectly conflating them.
For very small businesses or others that choose to outsource their card payments to a third-party platform (like all the hobbyists and market stall holders et al who use Stripe/PayPal/etc), the costs are not decreasing because those platforms (as intermediaries) are choosing not to lower their fees. Someone told me yesterday that Stripe has in fact increased its fees slightly (I haven't checked the truth of that).
Yep. The banks seemingly are throwing the baby out with the bathwater here. They should be doing more, not less, to get us to keep using credit cards.
