I understand that in February, the Competition and Consumer Amendment (Payment Surcharges) Act 2016 (Cth) came into effect. This legislation has as its objective the banning of surcharges imposed by businesses in respect of payments such as by credit card that “exceed the cost of acceptance for those payment methods”. There’s going to be a Reserve Bank standard that supposedly will limit the permitted surcharge to the direct costs of accepting payment by a particular method, such as bank fees and terminal costs. Of course, this issue has been around for a while, but previous steps to bring things into line have been ineffective.
I see that the Reserve Bank specifically states that, “If merchants (such as airlines) that currently impose fixed dollar surcharges wish to continue to surcharge, they will have to switch to percentage-based surcharges, unless their payment costs truly are the same across all transaction sizes.
Merchants will not be able to avoid the rules by calling their payment surcharges something else, like a ‘booking and service fee’ that applies to some payment methods but not others.”
Well, maybe we really are on the brink of meaningful changes. It seems unimaginable that the airlines would defy such a specific statement (they’re on record as saying they’d “comply”), but at the time of posting, Jetstar were still charging $8.50 (per passenger for domestic tickets) as a “Booking and service fee” for credit card payments, which was unavoidable if booking within 14 days of the travel date unless you had a Jetstar credit card or a Jetstar voucher. And likewise (at the time of posting) Virgin have a fee of $7.70 (per person) unless you use the POLi direct credit payment method or a voucher (which apparently requires you to call them – and so attracts a $35 fee)!
EDIT: It’s been pointed out to me that, if the airlines change their charging system for credit cards, there might be losers as well as winners. The existing fees would amount to 1% on an airfare of $770-$850. My assumption has been that most airfares on Jetstar and Virgin would be less than this (note, the current amounts are per passenger), but of course it’s possible that purchases of more than this amount could be made. But in the case of international bookings on Qantas, the surcharge for a credit card is $30, so you’d have to buying something more than an economy ticket to Europe before you’d be worse off if (when?) a change to a percentage-based surcharges occurred (depending, of course, on just what that percentage might end up being).