After months of debate, the Senate has passed a bill that will put an end to unregulated credit card surcharges
22 February 2016: Credit card holders can rejoice as high surcharges (potentially) become a thing of the past. The Competition and Consumer Amendment (Payment Surcharges) Bill 2015 was passed by the Senate this morning. The bill gives the Australian Competition and Consumer Commission (ACCC) the right to regulate companies that charge excessive credit card surcharges.
The ACCC will now have the power to investigate surcharges and issue infringement notices of up to $108,000 for companies caught overcharging cardholders. In October 2015, the Turnbull Government vowed to crackdown on surcharges and companies charging more than the 0.5% it costs to process a payment.
It turns out that many companies were charging, at least, double that amount. A 2015 Senate inquiry revealed that Qantas had been charging 339% above the average and Virgin Australia had been marking up 412% on airfare surcharges. Last year, Mastercard also found that Australians fork out around $1.6 billion a year in surcharges alone.
The new laws are expected to come into effect over the next few months, targeting some of the biggest brand names in Australia. As well as airlines, taxis and ticketing companies are just some of the companies that are expected to come under the pump later this year.
So what does this mean for you? If all goes to plan, you’ll be spending less money when you use your credit card to cover everything from taxi fares, concert tickets and flight costs. While that will depend on the ACCC actually taking enforcement action, it's a welcome development.