Before this change we already had a law to say that any surcharge must not be greater than the associated costs (and so it was illegal to be dishonest about the surcharge); and we had a law to say that the surcharge must be clearly advertised in advance of the say (hence all the signs and stickers warning people about a surcharge when it exists).
So from my point of view, that was fair. The surcharge was clearly associated with the cost of using that form of payment. But now, under the new system, the cost of that form of payment still exists but is unavoidable for the customer. I guess there’s marginally less thinking involved for people who never pay with cash, but aside from that I don’t see a benefit.
The article mentions that the RBA said removing the surcharge would “support a more efficient and competitive payments system”. But to me it seems to do the opposite. Suppose for example that a cheaper payment system arose. Previously businesses could have different surcharges for different payment systems, and customers could choose the cheapest. That is no longer the case. So then even if a more efficient and competitive system is created, it will be difficult for it to gain traction. Right?
Also, while this particular surcharge is being banned, others, such as weekend pricing, are not. So it’s not like surcharges are gone completely. Only this type of surcharge is being removed.
and we had a law to say that the surcharge must be clearly advertised in advance
Except it never was.
The surcharge was clearly associated with the cost of using that form of payment.
Except that the cost of handling cash is many times greater than the cost of using debit cards.
The point is that in practice, these charges had no purpose other than hiding the true cost of the product from the vast majority of customers whom they know are paying by card. It’s deceptive. The same reason we don’t allow tax to be added at checkout, and that we ban mandatory drop pricing.
The article highlights that anyone can offer a discount for cash.
It’s literally just flipping to cards such that instead of an increase to the sticker price for electronic payments, you get a decrease in the sticker price for cash payment.
So to clarify the question, the point of the change is Australia maintains the you don’t pay more than the sticker price rule.
And yes, weekend and public holidays surcharges on menus annoy the shit out of me and should be banned too.
Just a reminder that the law actually says weekend and holiday surcharges must be clearly stated in the menu at least as prominently as the most prominent item on the menu. So if it’s down the bottom in fine print, or if it’s the same size as normal menu items but they have specials extra large, you can tell them to stuff it.
So the core idea that although cash was the normal method of payment in the past, now card is the normal method of payment. Thus when card price and cash price are different, the card price should be the one listed - not cash price. Is that the gist of it?
I mean, I think that’s a reasonable argument. But as a counter point, cash is still the government supported standard; whereas other payment systems are processed by some third-party foreign company (such as Mastercard) - hence the fee.
I guess in the end it doesn’t really matter much. Maybe hiding the details makes for a better experience, but maybe it just entrenches the power of established transaction companies. I guess we’ll just see how it pans out.
whereas other payment systems are processed by some third-party foreign company (such as Mastercard) - hence the fee.
we should really have pushed a much greater use of eftpos for electronic transactions. eftpos is Australian and doesn’t rely in the fickle US Government
I don’t know what the point of the change is.
Before this change we already had a law to say that any surcharge must not be greater than the associated costs (and so it was illegal to be dishonest about the surcharge); and we had a law to say that the surcharge must be clearly advertised in advance of the say (hence all the signs and stickers warning people about a surcharge when it exists).
So from my point of view, that was fair. The surcharge was clearly associated with the cost of using that form of payment. But now, under the new system, the cost of that form of payment still exists but is unavoidable for the customer. I guess there’s marginally less thinking involved for people who never pay with cash, but aside from that I don’t see a benefit.
The article mentions that the RBA said removing the surcharge would “support a more efficient and competitive payments system”. But to me it seems to do the opposite. Suppose for example that a cheaper payment system arose. Previously businesses could have different surcharges for different payment systems, and customers could choose the cheapest. That is no longer the case. So then even if a more efficient and competitive system is created, it will be difficult for it to gain traction. Right?
Also, while this particular surcharge is being banned, others, such as weekend pricing, are not. So it’s not like surcharges are gone completely. Only this type of surcharge is being removed.
Except it never was.
Except that the cost of handling cash is many times greater than the cost of using debit cards.
The point is that in practice, these charges had no purpose other than hiding the true cost of the product from the vast majority of customers whom they know are paying by card. It’s deceptive. The same reason we don’t allow tax to be added at checkout, and that we ban mandatory drop pricing.
The article highlights that anyone can offer a discount for cash.
It’s literally just flipping to cards such that instead of an increase to the sticker price for electronic payments, you get a decrease in the sticker price for cash payment.
So to clarify the question, the point of the change is Australia maintains the you don’t pay more than the sticker price rule.
And yes, weekend and public holidays surcharges on menus annoy the shit out of me and should be banned too.
Just a reminder that the law actually says weekend and holiday surcharges must be clearly stated in the menu at least as prominently as the most prominent item on the menu. So if it’s down the bottom in fine print, or if it’s the same size as normal menu items but they have specials extra large, you can tell them to stuff it.
So the core idea that although cash was the normal method of payment in the past, now card is the normal method of payment. Thus when card price and cash price are different, the card price should be the one listed - not cash price. Is that the gist of it?
I mean, I think that’s a reasonable argument. But as a counter point, cash is still the government supported standard; whereas other payment systems are processed by some third-party foreign company (such as Mastercard) - hence the fee.
I guess in the end it doesn’t really matter much. Maybe hiding the details makes for a better experience, but maybe it just entrenches the power of established transaction companies. I guess we’ll just see how it pans out.
we should really have pushed a much greater use of eftpos for electronic transactions. eftpos is Australian and doesn’t rely in the fickle US Government
https://squareup.com/au/en/the-bottom-line/managing-your-finances/how-does-eftpos-work-australia
Different rates for different payment methods is daft.