ASGA supports payment schemes control

The Australian Sporting Goods Association has thrown its support behind the Australian Retailers Association and its call for greater card control.

In the April newsletter released today, executive director Shannon Walker reports, “ASGA supports the call, by retail industry body the Australian Retailers Association, for the Federal Government’s Financial Systems Enquiry to ensure all current and emerging payment schemes fall under the same guidance as the two major card schemes.

Currently, the two party schemes (where banks issue co-branded cards allowing systems like Diners and AMEX to avoid rules) are significantly hitting retailers’ bottom lines.

ARA Executive Director and chair of Australian Merchant Payments Forum, Russell Zimmerman, says “The ARA firmly believes that there is currently an unequal playing field. New entrants to the payment system are able to decide their own pricing model and choose if they wish to allow surcharging by the merchant, however, both of the schemes Visa and MasterCard are regulated to ensure that merchants are rightfully not charged more than a reasonable Merchant Service Fee.

“It is therefore only right that all participants in the payments system must be treated fairly and equally. Regulations need to be broadened to include both three-party schemes (AMEX and Diners) and the existing regulated four-party schemes (Visa and MasterCard) as well as new and developing entrants into the payment space,” Zimmerman says.

ASGA agrees with the key points raised in the ARA submsission:

• Rule changes are required in relation to co-branded or companion cards issued by financial institutions;

• All schemes need to be brought under regulation, not just the four party schemes that are currently regulated;

• Merchants should have the choice of routing for all payment transactions including, but not limited to, AMEX, Scheme Debit and contactless transactions;

• As internet transactions increase (currently at 6 per cent of total retail – expected to grow to 12 per cent of retail sales by 2020) and technology changes rapidly from cards to mobile devices to new POS equipment, merchants will need to invest heavily in new technology. Therefore, any costs to merchants need to be controlled;

As bricks and mortar retailers move to PIN on credit (August 2014 onward) there will be necessity for increased security in the online area as fraud will shift from bricks and mortar retailing to the online retail space;

Retail trading conditions are currently improving but unfortunately these increases are not being seen across all sectors of the retail industry.

Retailers are still struggling from the post GFC and are unable to accept costs of innovation and increases in merchants services fee that they have been experiencing from new entrants into the payment space.  


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