The payments landscape has changed rapidly since the RBA’s last review of retail payment systems. The emergence of new payment schemes such as buy now, pay later (BNPL) has skewed the market and left consumers without protections offered by other credit providers. The result is a marketplace where BNPL providers are not playing by the same rules as other payment providers as merchants are prevented from passing on fees they incur for this payment method. Consumers ultimately bear the cost of this as merchants are forced raised the costs of goods and services to cover the high costs imposed by BNPL providers.
For reasons set out below, our organisations strongly support action by the RBA to level the playing field and allow merchants to send price signals to customers based on how they choose to pay for a product. The RBA should also aim to future-proof the payment system to accommodate new and emerging payment methods.
Additionally, we support giving merchants greater control over routing options and for the RBA to retain caps on interchange fees with a view to potentially remove these fees altogether, as has been done in Canada and New Zealand.
Finally, we would welcome the RBA’s intervention to coordinate regulatory and industry action on direct debit and recurring payment problems. Many of our clients face difficulties and barriers when trying to cancel recurring payments and we believe a coordinated approach is needed to address this
issue. Consideration should also be given to how the roll out of the Consumer Data Right will affect the payments system generally.
