Visa Australia boss slams Amex, Google and Apple not being included in RBA card surcharge ban

The local boss of Visa says the Reserve Bank’s move to ban card surcharges makes sense, but has hit out at the ‘awful’ decision to exempt Amex, and Google and Apple’s phone payments systems.

Visa is unhappy the RBA’s proposed changes will not apply to BNPL providers and American Express. Picture: NCA NewsWire / David Mariuz

The local boss of payments giant Visa says the decision to allow Amex, Google and Apple to continue adding surcharges, amid a mooted plan to scrap most card fees, risks a rise of unregulated payments.

In the wake of the Reserve Bank announcing it was looking at ending almost $1.2bn in card fees, as well as slashing the interchange costs paid by small businesses, Visa Oceania group country manager Alan Machet said the move could have unintended consequences.

Mr Machet said the decision to continue allowing Amex, buy now, pay later providers, and Google and Apple to continue adding surcharges was a “bad outcome that risks creating and seeing a lot of volume move to those participants”.

But Mr Machet said scrapping most surcharges was a “very good thing”, noting Australia was poised to follow the likes of Britain and the EU.

In its report, the RBA noted allowing surcharges on payments had put downward pressure on American Express, which was not subject to interchange regulations, cautioning the removal may reduce the competitive pressure.

American Express is currently under a voluntary agreement with the RBA to not impose ‘no-surcharge’ rules on its cards.

Mr Machet, who took on the top job at Visa’s Australian arm in 2024, said allowing the likes of Amex to continue surcharging was “awful” and “such a miss”.

However, the RBA noted in its report some merchants may constrain Amex’s ability to raise prices by “threatening or choosing not to accept American Express altogether”.

Australian banks have been lobbying for American Express and BNPL providers to be subject to RBA regulation.

Many of the rules governing the payments system have been untouched for almost 20 years.

Alan Machet.

Mr Machet said he was interested to see if Australia would experience a repeat of the rise of rewards cards, which charged businesses higher costs for their use, in the wake of the decision.

The RBA moved to allow companies to pass on surcharge costs in 2009 in response to the rise of high-cost rewards cards, in a bid to demonstrate to consumers the different costs of their payments.

But Mr Machet said the RBA’s mooted plans to squeeze the interchange costs paid by businesses as part of card payments risked baking long-term risks into the payments system.

He said many of these card fees were used by payments players to fund security improvements, adding that drastically scaling them back would result in investment slumping over the medium term.

“While it feels like it’s an easy thing to just reduce that cost, it also reduces the amount of investment available to build the best possible payments system,” he said.

Mr Machet said the RBA had “gone too far”, and they were “creating a lot of risk”.

“In 10 years’ time we will ask, does Australia still have a safe, secure innovative payments system?” he said.

American Express has been contacted for comment.

Originally published as Visa Australia boss slams Amex, Google and Apple not being included in RBA card surcharge ban