Retailers resist surcharge change
17 August 2011
THE retail industry has hit back at suggestions that excessive surcharging of credit cards is becoming more widespread.
It says there is no need for the Reserve Bank to rein in the practice. The central bank is going through about 40 submissions made to its review on surcharging. A June report from the Reserve Bank found the largest merchants – with annual turnover in excess of $530million – were the most likely to slug consumers with a surcharge for paying by credit card. It also found that, as of December last year, about 30per cent of merchants imposed a surcharge on at least one of the cards they accepted.
In its submission, the National Retail Association, representing national retail chains and independent retailers, said there was no case for a surcharge limit. ''The vast majority of our members do not pass on any surcharge to customers, regardless of the method of payment,'' the association said. ''To the extent that surcharging exists in the retail sector, we are not aware of any instances of excessive surcharging.'' But the director of policy and campaigns at the Consumer Action Law Centre, Gerard Brody, said more action was needed to prevent price gouging by merchants. ''We are concerned that there are some retailers, particularly online, implementing credit card charges far above the cost of the credit card payment mechanism and more does need to be done to stop it,'' Mr Brody said.
The head of campaigns for Choice, Matt Levey, said surcharges should reflect the direct cost of the transaction and nothing more. ''The only retailers that would be targeted by a cap are those who are excessive,'' Mr Levey said. He said the biggest offenders of surcharging were airlines, the taxi industry, telecom companies, holiday travel businesses and utilities.
