The Federal Government will urge consumer agencies to actively monitor credit card provider practices for hidden fees and charges and to develop protocols to more responsively address consumer concerns following the release of a Commonwealth Consumer Affairs Advisory Council (CCAAC) study into Credit card surcharges and non-transparent transaction fees.
The Federal Government has also referred the report's findings to the Australian Securities and Investments Commission and the Australian Competition and Consumer Commission, to consider these issues in the light of businesses’ obligation to avoid misleading consumers.
The study makes clear consumers are dissatisfied with surcharges or fees that hide the true cost of goods or services, particularly in the airline industry.
Existing ASIC and ACCC powers appear adequate to deal with hidden or non-transparent fees and charges where consumers are being misled and these consumer agencies are invited to work together to ensure a coordinated focus.
The Reserve Bank of Australia (RBA) is committed to monitoring the effect of recent changes to its surcharging rules. CCAAC encouraged the RBA to give full consideration to the interests of consumers in doing so.
The Government is strongly encouraging businesses to adopt the better practice principles that this report has identified to improve consumers’ experiences when making transactions.
This includes adopting simpler pricing methods, ensuring that surcharges and fees are accurately described, and improving the practicality of surcharge and fee-free options.
The CCAAC report noted that credit card surcharges that reflect the reasonable costs of card acceptance are important to driving efficiency and competition in the payments system.
It is important for businesses to be able to continue to apply surcharges that reflect the reasonable costs of card acceptance as it supports them in negotiating lower card payment costs.