The National Retail Association is calling on the Reserve Bank to end unnecessarily high merchant fees associated with card transactions which unfairly impact small business, following the release of the RBA’s Retail Payment statistics yesterday.
National Retail Association Chief Executive Dominique Lamb said the Reserve Bank and policy makers have an opportunity to implement least cost routing measures to assist small retailers as they struggle with the rising cost of doing business.
“The Reserve Bank can fix this unfair system by applying least cost routing. This will reduce costs to small businesses in this economically uncertain time, and potentially dodge having to surcharge customers more,” Ms Lamb said.
Least cost routing allows retailers to choose to send transaction via the debit network that costs them the least to accept. With 70 per cent of retail transactions made with debit cards, it is paramount in helping small businesses to better manage their costs.
“When a customer makes a debit payment, small businesses should have the power to choose the most financially viable debit network option,” Ms Lamb said.
“This issue is hurting small business around the country every day and it is only getting worse. The inability to route transactions is currently costing Australian businesses $70 million each month.
“Consumers paying with debit and credit cards has increased by 30.2 per cent in the past year, and the associated costs will only continue to increase as more people move to mobile payments which currently cannot be routed because of the Reserve Bank’s inaction. Mobile payments are growing quickly and are subject to up to seven times the wholesale fees of normal card payments.
“This issue is hurting small business around the country every day and it is only getting worse. The inability to route transactions is currently costing Australian businesses $70 million each month.
The National Retail Association is the voice of modern retail, representing more than 60,000 stores across Australia. It has been serving businesses in the retail and fast food sectors for close to 100 years.
Source: ASBFEO
