Australian sky-high surcharges ‘a thing of the past’ - Choice

BTN News
Thursday, 26 May 2016

Australian consumer group Choice has welcomed the Reserve Bank of Australia’s decision to ban fixed-dollar surcharges from 01 September after nearly a decade of campaigning against the activity, common with airlines and ticketing companies.


The RBA’s decision follows the Competition and Consumer Amendment (Payment Surcharges) Bill 2015 that was passed by the Senate in February 2016, giving the Australian Competition and Consumer Commission (ACCC) the power to crack down on companies charging excessive surcharges for card payments.


“The RBA’s decision means businesses with revenue in excess of A$25 million or 50 or more employees such as airlines and ticketing companies will have until September to end their flat fee frenzy,” said Choice spokesperson Tom Godfrey.


“Under the new rules, surcharges will be limited to the direct costs of providing the payment method. This will simply include bank fees and terminal costs, not a hefty profit margin.


“For years, some of Australia’s biggest businesses have been slugging consumers with excessive flat fees - up to 1,000 per cent above the cost of processing payments.
“Even though the writing has been on the wall since February, the airlines are still punishing consumers with sky-high fixed surcharges that don’t reflect the costs of accepting cards.


“We think they should have already acted in their customers’ interests and reduced their surcharges. They know they are in the wrong,” said Godfrey.


Choice analysed airline surcharges again this week and found excessive booking fees that don’t reflect the actual cost of processing a credit card. The consumer group found that the Qantas A$7 card surcharge on a cheap flight is 348 per cent higher than it should be, and Jetstar’s A$8.50 surcharge is a 1,182 per cent mark-up.
“It is now time for consumers to call these corporate profiteers to account - if you make a purchase and the business slugs you with an excessive flat fee surcharge we want you to report it,” said Godfrey.


Consumers now can report a sky-high surcharge at www.choice.com.au/shonkysurcharges


“The great news for consumers is that the ACCC has recently been given the power to investigate whether a surcharge is unfair and issue infringement notices of up to A$108,000 for companies that don’t play by the rules,” said Godfrey.


“With the ACCC’s new powers and the RBA standards in place, it couldn’t be clearer that the age of sky-high surcharging is over.”

Australian sky-high surcharges ‘a thing of the past’ - Choice

BTN News
Thursday, 26 May 2016

Australian consumer group Choice has welcomed the Reserve Bank of Australia’s decision to ban fixed-dollar surcharges from 01 September after nearly a decade of campaigning against the activity, common with airlines and ticketing companies.


The RBA’s decision follows the Competition and Consumer Amendment (Payment Surcharges) Bill 2015 that was passed by the Senate in February 2016, giving the Australian Competition and Consumer Commission (ACCC) the power to crack down on companies charging excessive surcharges for card payments.


“The RBA’s decision means businesses with revenue in excess of A$25 million or 50 or more employees such as airlines and ticketing companies will have until September to end their flat fee frenzy,” said Choice spokesperson Tom Godfrey.


“Under the new rules, surcharges will be limited to the direct costs of providing the payment method. This will simply include bank fees and terminal costs, not a hefty profit margin.


“For years, some of Australia’s biggest businesses have been slugging consumers with excessive flat fees - up to 1,000 per cent above the cost of processing payments.
“Even though the writing has been on the wall since February, the airlines are still punishing consumers with sky-high fixed surcharges that don’t reflect the costs of accepting cards.


“We think they should have already acted in their customers’ interests and reduced their surcharges. They know they are in the wrong,” said Godfrey.


Choice analysed airline surcharges again this week and found excessive booking fees that don’t reflect the actual cost of processing a credit card. The consumer group found that the Qantas A$7 card surcharge on a cheap flight is 348 per cent higher than it should be, and Jetstar’s A$8.50 surcharge is a 1,182 per cent mark-up.
“It is now time for consumers to call these corporate profiteers to account - if you make a purchase and the business slugs you with an excessive flat fee surcharge we want you to report it,” said Godfrey.


Consumers now can report a sky-high surcharge at www.choice.com.au/shonkysurcharges


“The great news for consumers is that the ACCC has recently been given the power to investigate whether a surcharge is unfair and issue infringement notices of up to A$108,000 for companies that don’t play by the rules,” said Godfrey.


“With the ACCC’s new powers and the RBA standards in place, it couldn’t be clearer that the age of sky-high surcharging is over.”