On Monday February 22nd, 2016 the Federal Senate passed the new law legislation forbidding surcharges on credit card usage. This is to counter the current practice, where we already have corporations charging more for the usage, with some even advocating for the fees to rise up to 10 times the current charge.
According to the Senate, the law that will come into effect later this year is already under scrutiny as The Australian Competition and Consumer Commission (ACCC) is monitoring it closely. The ACCC has also declared any co-operation found to engage in such practises may face a fine of up to $108,000. Consumers have been under tough credit card processing costs with Jetstar charging $8.50 on an $85 fare, believed to cost just 66 cents to process.
The Laws of the Credit Card
The national treasury believe this would come as a sigh of relief because not every consumer is able to afford the current costs. The treasurer Scott Morrison added, many merchants do pass on costs fairly, while some merchants engage in this practice abusively. The call to have the surcharge banned outright has had over 500 petitions submitted on the website change.org administered by Queensland businessman Klaus Bartosch on the Murray financial system inquiry.
MasterCard in 2014 conducted the research that showed Australians were in fact being charged about $1.6 billion a year in surcharges. This has been done by the big businesses while the small ones tread carefully as they are mostly under scrutiny by the legislature. Bartosch predicted if the new law does not fully ban the surcharges, the annual charges will escalate to about $6 billion to $7 billion.