Fabian Demicoli

When Governments are really small business friendly, they act!!

 Australian debit processor to cut interchange fees – Australian merchants will incur no interchange fees on transactions under AUD15 ($15) under a new multilateral interchange fee model. The Australian debit processing network EFTPOS Payments Australia Limited (EPAL) has announced the new model, which will replace the current system of bilateral interchange fees agreed between different participants in the network.


From 1 October 2011, fees for transactions on the network are to be set at 5 Australian cents for POS transactions of AUD15 ($15) or more. Fees are set to be zero on transactions for charities, Medicare Easyclaim (the Government health insurance programme), and transactions under AUD15.

EPAL has said the new fee model follows extensive consultation with banks and retailers and will support investment into making the network more secure and accessible for both retailers and consumers.

"The new 5 cent interchange fee for standard POS transactions is less than half the equivalent fee of 12 cents payable for international scheme debit cards [Visa and MasterCard]," said EPAL managing director Bruce Mansfield.

"Our new multi-lateral interchange fees should be considered alongside the separate scheme fees that apply to both EFTPOS and international scheme debit cards. When the significantly cheaper EFTPOS scheme fee is factored in, EFTPOS transaction charges will be three to four times cheaper for retailers than international debit card transactions."

The zero interchange fee for low-value transactions is intended to provide an incentive for more retailers to accept small payments on EFTPOS.

"Today, approximately 25% of EFTPOS transactions are below $20," said Mansfield. "In New Zealand this is figure is as high as 50%, so there is a considerable opportunity to convert more cash transactions to EFTPOS in Australia."

The introduction of a new EFTPOS interchange fee model follows a decision by the Reserve Bank of Australia in November 2009 to recognise multi-lateral EFTPOS interchange fees and to align the EFTPOS multi-lateral interchange fee standard with those for international scheme debit card interchange fees.

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