The head of Australia’s dominant taxi-payments system is defending a 10% surcharge it levies on payment card payments, local media report.
In fact, the surcharge imposed on customers paying their taxi fares using credit, charge or debit cards is not limited to his organization, Reg Kermode, CEO and Chairman at Cabcharge Ltd., told the New South Wales Parliament
“There are taxi companies that run account systems that are quite separate to Cabcharge under which I understand they still charge the 10%,” he reportedly said. “So it is not just something that is restricted to Cabcharge. That is a mistaken view.”
The New South Wales Parliament is reviewing complaints that the taxi industry is anticompetitive and dominated by Cabcharge.
Last June, the Australian Competition and Consumer Commission had filed a lawsuit against Cabcharge, whose electronic payment system is found in more than 96% of Australian taxis, limousines and water taxis.
The suit, filed in federal court, contends Cabcharge Australia Ltd. uses its power to restrict competition in card payments for taxi fares. Cabcharge reportedly operates nearly all electronic-payment systems in Australian taxis.
Immediate comments from Cabcharge were unavailable, despite repeated PaymentsSource requests.
Matthew Sinclair, executive director of Australia-based Carpadium Consulting, tells PaymentsSource Cabcharge has had a virtual monopoly on the use of payment cards in taxis for many years. “As a taxi customer, it’s more than a little bit inconvenient to be charged an extra 10% on top of the fare just to process the payment,” he says. New technology, such as mobile payments, might offer cheaper alternatives to Cabcharge, he says.
But “I would never underestimate Cabcharge. The company has been incredibly successful, … and [it] will take some serious effort to dislodge, whether that happens through legitimate competition or from the regulators,” Sinclair says.
What do you think about this? Send us your feedback.
