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2007
Inquiry into excess credit cards charges may lead to less fees
Wednesday March 17, 2010
The NSW Government has today commenced a research project into any excess fees and charges that credit cards consumers are paying when using their credit cards with certain industries. These excessive surcharges may be eliminated completely on certain credit card purchases as the Government tries to make the credit industry more consumer friendly.
The inquiry has come about after figures show that certain credit card charges, such as airfares and taxi trips, have been hit with up to ten percent usage fees by the merchant which in this case is the Airline or Taxi business.
These fees have been allowed ever since the 2003 move by the Reserve Bank when the RBA scrapped the "no-surcharge rule", which was meant to allow Australian merchants to recoup their cost of using a consumer's credit card as a viable payment option while also encouraging industry competition and lower costs when using a credit card.
However, as an unexpected drawback, the move has allowed market leaders in certain industries to charge up to ten percent on consumer charges with consumer group Choice finding that Qantas and Tiger airways charge their passengers $7.70 each per credit card transaction, around ten percent, when the true cost is estimated to be closer to one percent.
