Visa tackles Reserve over cards reform
The head of payments policy at the Reserve Bank tried to bust a few myths about the credit card sector, and the RBA’s new regulations, at an industry conference. Myths dispelled included that the RBA’s regulatory approach was motivated by an anti-credit card zeal; that the bank is concerned about credit card debt; and that the RBA is protecting cash in order to collect revenue for its own ends. Other doubtful tales on the RBA’s list were challenged by Visa. According to Visa, American Express and Diner’s Club were “untouched” by the RBA’s reforms; lower fees charged by banks on merchants don’t translate into lower prices, and Amex and Diner’s Club have had big increases in market share since the regulations were introduced. Visa also rubbished the Reserve Bank claim that the reform of card fees helped prompt the introduction of low interest credit cards, a trend underway before the Reserve Bank decided to regulate the market.