The Reserve Bank of Australia (RBA), the country’s central bank, is considering reducing the cost of electronic payments for merchants and consumers as COVID-19 makes e-banking preferable, Assistant Governor Michele Bullock said on Wednesday.
Reuters reports RBA is reviewing Aussie’s retail payments regulation to determine the cost and resilience of electronic payments and access to cash.
Bullock has said ATM withdrawals were off 30 percent from March and more than 40 percent one year ago as customers switched to contactless payments.
Bullock said its a problem because the lack of cash has increased the cost of doing businesses for some merchants when debit card payments are automatically routed through international schemes.
“So far, the bank has not mandated that acquirers explicitly offer least-cost routing to all their merchants, but it remains an option that will be considered in the review,” she said in a speech titled “Panic, Pandemic and Payment Preferences,” the news service reported.
RBA’s investigation is expected to examine how transparency of the payment plans offered to merchants could be improved.
“Ultimately though, if market forces are not generating competition to lower the cost of debit card payments, we may need to consider lowering the benchmarks that serve as a cap on average interchange fees,” Bullock said.
In addition, she said the use of less cash was making industry considerations of consolidating ATM networks more urgent, the report said.
“I expect that there will be action on this issue more quickly now,” she said.
In February, PYMNTS reported RBA and its Payments System Board launched a new payments infrastructure dubbed the “New Payments Platform” (NPP) to allow customers with accounts at different banks make real-time payments to each other.