Card fee hits shoppers

CUSTOMERS given no choice at check-outs but to pay by card are being slugged with sneaky, often unadvertised, fees.

The pandemic has resulted in many merchants refusing to accept cash and instead requiring customers to swipe or tap at the checkout.

The card fees typically add 0.01 per cent to the cost. So a $10 drink at a bar might cost the customer $10.10 by card.

The Reserve Bank of Australia’s deputy head of payments policy Chris Thompson said, in line with consumer law, prices displayed by merchants must be “clear, accurate and not misleading”.

“If a merchant is going to surcharge all types of card payments while not accepting cash, the posted price should include the minimum surcharge. The advertised price should be achievable by at least one method of payment without an additional charge being put on top of it,” he said.

Merchants are legally allowed to knock back cash.

RBA statistics show the decline in cash continued during the pandemic.

In October last year there were almost 45 million ATM cash withdrawals worth $10.6bn. This fell to 33.5 million withdrawals worth $8.9bn in October this year.

Competition watchdog the Australian Competition and Consumer Commission said a merchant does not have to offer a surcharge-free option to customers when they pay for goods or services, but they cannot “charge consumers more than it costs them to process a credit or debit card payment”.

“Consumers can report misleading prices to the ACCC.”

The penalties for making false or misleading representations start from $500,000.

Consumer Action Law Centre’s CEO Gerard Brody said that businesses must disclose the surcharge clearly to customers and it cannot be extortionate.

“The surcharge can only cover their costs of accepting card payments and if they are charging more than that then it’s opening themselves up to a fine by the ACCC,” he said.

“If businesses are advertising a product at a price the consumer should have a way of purchasing that product without imposing a surcharge.”

Mr Brody said card payments were “more convenient” but it was important for “businesses to be clear and transparent with their pricing”.