Retailers 'cannot afford' proposed rises in card transaction fees

Moves to increase processing fees for credit card transactions could have an impact on the cost of goods, it has been claimed.

Plans to increase card fees could prove to be of detriment to retailers, it has been suggested.

Commenting in the wake of plans by the Australian Bankers' Association to implement an interim EFTPOS interchange fee standard, the Australian Retailers Association (ARA) points out such moves could significantly increase costs for the industry.

With the expense of each charge and credit card transaction potentially rising by 17 cents, ARA executive director Russell Zimmerman tells Franchising that under the proposals retailers could face total costs of $250 million each year.

And although he claims that the cost of accepting card payments has fallen in recent year, such savings have been passed on to customers.

However, as "transaction fees are only one of the many expenses that influence retail pricing", it was claimed retailers will simply be unable to afford the proposed increase in costs.

Last month, Christopher Zinn of Choice told the Courier-Mail that while the fees imposed for paying by card may at first not seem very much they can quickly add up.

He also questions the transparency of the Australian banking practice which currently sees some firms charge as much as ten per cent of the transaction value.

Posted by Nate Sawyer