Aussie airlines forced to drop excessive credit card fees

Australian airlines have been given notice over excessive credit card surcharges after Australia's central bank confirmed changes to merchant rules on Thursday.

The Reserve Bank of Australia (RBA) has been reviewing Australia's payment system regulations since mid-2014 and on Thursday confirmed credit card surcharges will be expressed in percentage terms and not in excess of a merchant's cost of acceptance.

"Merchants will not be able to impose high fixed-amount surcharges on low-value transactions, as has been typical for airlines," the RBA said in a statement.

Australia's consumer watchdog will be responsible for enforcing the new provisions from September 1, focusing mainly on the larger merchants with consolidated gross revenue of 25 million Australian dollars (18.03 million U.S. dollars) or more, or employ 50 or more people. All others will come under the new rules in September 2017.

"We will focus on education and awareness in the early stages but won't turn a blind eye to possible breaches, particularly for those large businesses clearly on notice of these changes," ACCC chairman Rod Simms said in a statement.

The ban as no effect on Australian retailers that choose not to impose payment surcharges, such as those that incorporate the costs into overall prices, the ACCC said.

The new standards will apply to six card systems -- EFTPOS, Debit MasterCard, MasterCard Credit, Visa Debit, Visa Credit and American Express cards. Endit