Australian central bank to set card-fees cap

Australian central bank to set card-fees cap
Tags: Associations / Conferences, Bank / Credit Union, EFT Networks, Regulatory Issues, Transaction Processing, Trends / Statistics
May 8, 2006

Datamonitor: The Australian banking regulator is expected to impose a cap on interchange fees that it is estimated to cost the local payment-card industry $170 million ($131.5 million) per year. Australia's central bank said it imposed a 75 percent drop on current highs to promote competition in the market. Visa offers much greater returns on debit-card processing fees than EFT POS. The disparity has left the market effectively tipped in Visa's favor. According to Bloomberg, the central bank wants Visa to cut fees from 40 cents (U.S. 31 cents) to 15 cents (U.S. 12 cents) per transaction.

Read also, Aussies' cash back option could check out and isa, ABA urge regulators to reform interchange rules.