Why have I been charged a surcharge for using my credit card?
In August 2002 the Reserve Bank of Australia released three credit card related reforms. One of these removed credit card rules that prevented merchants from recouping the cost of merchant service fees directly from consumers who purchased goods or services using a credit card. This means that from 1 January 2003 consumers could be charged an additional fee when they purchase goods or services with their credit card.

What are merchant service fees?
Merchant service fees are those imposed by the merchant’s bank each time the merchant accepts a credit card payment. Merchant service fees are calculated as a percentage of the value of the goods and/or services purchased, and included in the cost of merchant service fees is the cost of interchange fees.
Merchant service fees are a significant cost to small business. The reforms are expected to reduce these fees through increased competition (new entry) and increased price transparency (merchant pricing).

How will I know if a merchant is going to charge me a credit card surcharge?
It is important to note that not all merchants will wish to charge their customers a credit card fee. However, if a merchant does decide to impose one, they must ensure that consumers know:

» the credit card fee will apply
» the amount of the fee before they enter into the transaction.

Merchants must not mislead or deceive consumers.

Where can I go for more information if I think I may have been misled about credit card surcharges?
The charging of a credit card surcharge is defined as a financial service and is therefore outside the Commission’s jurisdiction under the Trade Practices Act.
For further information about credit card surcharge disclosure, contact the Australian Securities and Investments Commission (see Other agency contacts in the Related documents box).

What is the ACCC’s role in relation to credit card surcharging?
Part IV of the Trade Practices Act prohibits anti-competitive arrangements between competitors, such as price fixing, market sharing and boycotts. This means that businesses must make their own independent decision on whether to impose a credit card surcharge.
Businesses must not engage in anti-competitive conduct.
Businesses must not enter into agreements or understandings with other businesses, such as:

» whether or not to impose a credit card fee
» the amount of the credit card fee that you will charge.

Such agreements or understandings are contrary to the competition provisions of the Trade Practices Act and significant penalties may apply.

How much should the credit card fee be?
The Reserve Bank’s reforms allow the merchant’s bank (i.e. the provider of the merchant’s credit card 'swipe machine' facility) to restrict their merchants from charging a fee that is greater than the merchant service fee.
The ACCC does not have a 'price setting power' for credit card fees. It strongly encourages consumers to include the cost of the credit card fee when deciding what they wish to purchase and to shop around to get the best value for their needs.

Bank fees
While the ACCC cannot set or regulate interest rates or fees charged by banks and credit unions, it does maintain an informal oversight of bank fees and charges.”