Even with the heavy fees that comes with it, the ‘tap and go’ trend on debit and credit cards continues to grow , as cash transactions seem to be becoming a thing of the past.
According to the Reserve Bank’s yearly bank fee survey showed that banking fee income made from businesses that accept tap and go payments has grown massively in the past few years. There was a 3% increase on the overall fee income from businesses with merchant service fees on card transactions as the main driver of the spiker.
Over the last couple of years, RBA also found that there has been a significant decline in ATM withdrawals as people are opting for electronic payment options over cash. Aussie shoppers are after the convenience provided by tap and go.
In addition to this, many banks are now offering services like mobile payments options on their cards, like Apple Pay, Samsung Pay and Google Pay, it’s never been easier for customers to tap and go on purchases which hurts small businesses hard as they try to keep up with the large fees they pay on card transactions.
To provide customers and business owners other options to the more expensive Mastercard PayPass and Visa Paywave, the RBA is currently pushing to help low-cost payment alternatives grow, like eftpos. Moreover, they are working on reforming the way in which banks charge merchants on tap and go transactions.
Peter Marshall, Mozo’s Banking Expert, said “Contactless payments have become the main method of paying for shoppers, so it’s crucial that we establish a fee structure that is regulated properly. It’s important that the system is fair for both businesses and customers, so smaller businesses aren’t left struggling to keep up with the large fees that come with accepting tap and go payments.”
Least-Cost Routing Explained
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