Australian Prime Minister Malcolm Turnbull has announced plans of new laws by mid-2016 which will ban merchants from imposing unfair credit card surcharges.
The plan is response to the financial system inquiry made by former Commonwealth Bank boss David Murray, which recommends a new three system of surcharging, with a total ban on surcharges for debit cards and a cap on levies for using Visa and MasterCard.
Under the new laws, Australian Competition and Consumer Commission will be responsible for ensuring card users to be treated fairly and not to be overcharged.
Major banks in Australia has surcharge fees of between 1% to 2%, while the other cards surcharges are 2 to 3%, and some are as high as 10%, according to Treasurer Scott Morrison.
He called the surcharge ban as a “fair dinkum test,” and said “it will have to pass the fair dinkum test – it has to be about the fair dinkum cost of what someone is actually absorbing and passing on.”
Mr Turnbull said most of the recommendations of the financial system inquiry has been accepted, and the federal government will bring more competition to the superannuation sector by providing greater choice of default funds.
“The government’s response improves our financial system and builds on existing policy,” Mr Turnbull said.