The Competition and Consumer Amendment (Payment Surcharges) Act 2016 commenced on 25 February 2016. The Act insert a new section into the Competition and Consumer Act 2010 (CCA) which bans excessive payment surcharges.
The introduction of this ban now prohibits excessive surcharges relating to payments covered by a Reserve Bank of Australia (RBA) standard or regulation made under the CCA.
The new provisions limit the amount that businesses can surcharge customers for the use of payment methods such as credit and debit cards. The limit is linked to the direct costs of the payment method such as bank fees and terminal costs.
The draft RBA standard proposes that businesses will receive information from their payment facilitators to help them set an appropriate payment surcharge which does not exceed their permitted surcharge.
The timing of implementation will depend on the RBA standard which is still being finalised. This allows businesses time to prepare and consider whether any payment surcharges currently being applied are higher than the cost of accepting that payment type.
The ACCC will be enforcing these new provisions from later this year and will provide more detailed guidance to businesses once the RBA consultation on its standard is finalised.
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