SYDNEY — Australia's central bank is considering imposing reforms on ATM and debit transactions as well as on some American Express charge cards, according to a Reuters report.
The bank is seeking the views of interested parties by July 9 on whether it would be in the public's interest to reform the use of ATMs and debit transactions, known in Australia as EFTPOS -- Electronic Funds Transfer at Point Of Sale.
The Reserve Bank is considering eliminating an interchange fee of 20 cents to 25 cents on every EFTPOS transaction paid by a cardholder's bank to the merchant's bank, according to Reuters.
Separately, a group made up of banks, building societies and ATM providers is proposing to drop foreign fees charged when consumers use an ATM provided by a lender other than their own bank -- known at "foreign" ATM transactions, said Reserve Bank Governor Ian Macfarlane.
(See related story ATM surcharge proposal suffers setback in Australia)
"They are proposing to replace it with an upfront fee, which you will see when you go to use an ATM. At the moment, a lot of people have no idea how much it is going to cost them, because they only find out from their bank statement when it comes a month later," he said.
The Bank said around 40 percent of ATM transactions are made on "foreign" ATMs which typically carry a charge of about $1.50 (U.S. $1.03) per transaction for the consumer.
The Reserve Bank of Australia has already won a court battle subjecting credit cards to new regulations which reduce interchange fees earned by financial institutions for credit cards.
After losing a challenge in September, Visa International and Mastercard both began complying with the rules, according to Reuters.
American Express may face similar regulations after it teamed up with some banks, making it a "four-party scheme" which may face the same fee reforms as Visa and Mastercard.
"There is a cardholder, a merchant, a bank and a card. We are looking into that to see whether that is some sort of regulatory arbitrage that could be covered by the rules we have for four-party schemes, but we have not made a decision on that as yet," Macfarlane said at a parliamentary hearing.
American Express said it had held discussions with the Reserve Bank in recent days but had no further comment at this stage.
