Payments consolidation would create a “bank monopoly”

The Australasian Association of Convenience Stores (AACS) is recommending that the ACCC step in and prevent a proposed consolidation of the New Payments Platform (NPP), Bpay and Eftpos.

AACS says the consolidation would create an “unassailable monopoly and massively dilute – if not eliminate – any tangible say that retailers now have over payments pricing, policy and future architecture.

“With banks already heavily favouring US credit giants MasterCard and Visa instead of routing contactless transactions over cheaper options like Eftpos, rushed consolidation risks killing crucial reforms like Least Cost Routing that have forced down interchange merchant service fees.

“Silencing retailers would give banks and credit card schemes a green light to gouge on transaction fees, which retailers already fork out $4 billion a year on. It’s a recipe for falling revenue and fewer jobs for Australian businesses, at a time of make or break for retailers riding out the recession.”

Just before the Federal Budget, Prime Minister Scott Morrison revealed Treasury will be “reviewing the regulatory architecture applying to the payments system to ensure it remains fit for purpose and is capable of supporting continued innovation for the benefit of both businesses and consumers”.  

This is separate from the RBA review, and means there are now two overlapping payments reviews.

AACS CEO Jeff Rogut said if the merger proceeded it could result in a single domestic payments provider, reducing competition and increasing costs for small businesses like convenience stores.

“This proposed merger is a threat to small business, and we are recommending the ACCC prevents it from proceeding. It’s more important than ever for retailers and small businesses to make themselves heard, and we will continue to lobby on behalf of the convenience industry to stop this unwelcome and damaging proposal.”

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