Victoria
Labor minister urges RBA to scrap merchant card terminal fees
Labor frontbencher Kristy McBain wants the Reserve Bank to remove bank fees for businesses using point-of-sale machines.
Federal Labor minister Kristy McBain has called on the Reserve Bank of Australia to expand its proposed crackdown on card surcharges by eliminating the fees banks charge businesses to operate point-of-sale terminals.
According to a wire report, the Labor frontbencher argued that addressing the cost of card transactions for everyday consumers should also involve relief for small business operators, who currently bear the financial burden of terminal rentals and merchant fees.
The debate comes as federal policymakers increasingly scrutinise the impact of surcharging on Australian consumers. Under current arrangements, many businesses choose to pass terminal and processing costs directly to customers, a practice that has drawn mounting criticism amidst broader cost of living pressures.
While the Reserve Bank of Australia has flagged potential reforms to the card payments ecosystem, Ms McBain's proposal shifts the focus directly onto the commercial banks. By removing the fees associated with operating point-of-sale hardware, proponents believe the government could reduce the overheads that lead businesses to surcharge in the first place.
Details remain limited on how such a mandate would be implemented, or whether the federal cabinet will formally adopt Ms McBain's position. It is currently unclear how the banking sector would respond to a forced removal of merchant service fees, or what alternative revenue models they might pursue.
The Reserve Bank has not yet confirmed whether it will integrate a ban on terminal fees into its broader review of merchant payment systems. Observers note that any intervention in bank-to-business fees would represent a significant escalation in regulatory oversight of the financial sector.
We will watch to see how the Reserve Bank of Australia responds to the proposal as it conducts its review into merchant terminal fees.
This report draws on original reporting by Wire report.
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