As more and more Australians adopt Tap-and-Go payments, small businesses are suffering under crippling transaction fees despite a promise from the big four banks to reduce costs.
The House of Representatives Standing Committee on Economics recommended banks introduce the least-cost routing of their tap-and-go payments for debit cards by April 1 2018. Yet despite this, they are dragging their heels and it’s coming at a cost for SMB owners.
The Australian Small Business and Family Enterprise Ombudsman, Kate Carnell has called out the banks for not meeting the deadline.
“The National Australia Bank and ANZ promised to roll out the changes this year, and here we are with just 20 days left of 2018 and no action,” Carnell said.
“The Commonwealth Bank of Australia committed to the changes but didn’t give a timeline.
“At least Westpac confirmed it will offer least-cost routing to its business customers in 2019, but it did not confirm if it will happen in the first or second half of the year.”
Carnell said the average total merchant fee for a debit transaction is 0.26 per cent with EFTPOS and 0.58 per cent for Visa or Mastercard, and it’s higher for small businesses.
“So there’s a nice bit of revenue for the banks over the last nine months and another example of their pursuit of profit,” Carnell proclaimed.
“We need to see some action by the banks, who still need to rebuild trust and confidence with Australian small businesses.”