If the fees charged by the merchant/trader have not been authorised in the first instance by the commercial bank then such fees must not be charged.
This is the response by the Independent Consumer and Competition Commission (ICCC) complaints by consumers on some businesses and shops charging clients extra fees for using an EFTPOS.
The ICCC has dealt with a number of EFTPOS related complaints in the past; they have established that the Merchant Agreement spells out the obligation of both parties and provides for avenues for the commercial banks as owners of the EFTPOS machines to penalise a merchant/trader that breaches the terms of the Merchant Agreement.
For example, it allowed the commercial banks to repossess the machines should a merchant/trader breach the terms of the Merchant Agreement.
As part of the Merchant Agreement, merchants/traders were discouraged by commercial banks to charge customers additional transaction fees, but were encouraged to recoup this cost by passing this to customers through their normal mark-up of goods and or services.
Complaints against Electronic Funds Transfer at Point of Sale (EFTPOS) charges by merchants/traders are an ongoing issue around the country. With regards to merchants/traders charging customers either for:
- Using EFTPOS machine in the merchant/trader’s shop when paying for goods;
- Using the EFTPOS machine in the merchant/trader’s shop when checking their bank balance;
- Using the EFTPOS machine in the merchant/trader’s shop for cash out transactions without doing any purchase; or
- Using the EFTPOS machine in the merchant/trader’s shop when undertaking (1) and requesting cash back
“The commercial banks must enforce the relevant terms of their respective Merchant Agreements in the first instance,” says ICCC.
“This is an alternate to them closing the merchants/traders’ bank accounts which obviously, is not in the commercial interest of the commercial banks.
“Nonetheless, the commercial banks must take the lead to address customers’ concerns concerning the use of their EFTPOS machines issued to merchants/traders.”