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A proposal by Australia's central bank to revise interchange regulations could result in higher card-acceptance fees for some merchants, according to the Australian Retailers Association. The Reserve Bank of Australia last week said it would maintain its supervision of interchange rates because competition in the payments industry had yet to produce lower card costs (CardLine Global, 27 Aug.). The bank went on to say that the "difference in regulatory treatment" between debit cards carrying such international brands as MasterCard and Visa and those of the domestic EFTPOS scheme "may be detrimental to competition." The bank says it might change interchange rules so they are "consistent" for domestic and international debit brands. The EFTPOS network includes some 650,000 payment terminals deployed in Australia and New Zealand. The retailers' group worries merchants will end up paying more to accept domestic debit cards. "The [Reserve Bank of Australia's] latest proposal will price every debit card payment at the highest existing rate," Russell Zimmerman, the group's executive director, says in a statement. Matthew Sinclair, executive director of Australia-based Carpadium Consulting, tells CardLine Global the Reserve Bank could raise EFTPOS interchange rates or lower international debit rates. "If it's the former, then I would expect that merchants will pass these extra fees directly on to consumers, which will mean that the differences between using debit and credit at [the point of sale] will effectively disappear," he says. "I am struggling to see how this will benefit the end consumer, and I don't imagine that this will be all that popular with merchants." The Reserve Bank provided no immediate comment.
