Dr Tony Richards
Head of Payments Policy Department
Reserve Bank of Australia
Dear Dr Richards,
RE: Reserve Bank of Australia (RBA) 2015 Card Payments Regulation Issues Paper
As an industry leader in the Australian payments system, ANZ has worked collaboratively
and constructively with the RBA and industry participants over many years to improve
payments system security, stability and efficiency. ANZ welcomes the opportunity to
respond to the RBA 2015 Card Payments Regulation Issues Paper and support the RBA’s
work to improve the future regulatory framework governing the Australian payments
system.
Payments System Transformation and Operating Efficiency
Since the 2003 payment system reforms, the payments landscape in Australia has been
transformed and improved materially. We have seen many large-scale investments by
industry participants that have generated clear benefits for consumers, merchants, issuers
and acquirers. The 2003 framework has also reshaped the competitive landscape. New
market entrants, disaggregators and innovative disruptors have entered the system and are
actively competing directly with traditional payments players.
The current commercial model involves exchange of value between merchants, customers,
and acquiring and issuing institutions through merchant service charges, interchange fees
and other payments, and customer benefits and charges. These arrangements have
promoted vigorous competition among financial institutions for customers and merchants,
and have been critical for investment in payment system improvements and innovation over
the past decade. ANZ has invested, and intends to continue to invest heavily in future
payment technologies and products. These include contactless/NFC, mobile and online
acceptance, eHub and the New Payments Platform that will further promote payment
system innovation, competition and customer value.
Given this, it is our view that any proposed change to the aggregate commercial value
currently generated by the payment systems, or the material re-distribution of value among
system participants, needs to be carefully considered. It is critical to maintain the
commercial foundation for competition and investment, and make sure that it is viable for
new competitors to enter the market.
ANZ recognises that there were many concerns raised on the topic of surcharging. Excessive
surcharging by a small number of merchants should be addressed. It is appropriate that
further work be undertaken on how to best manage these issues in the interest of
consumers and merchants alike. The technical feasibility of any proposed changes should
be considered in consultation with relevant participants.
If the RBA determines that changes to the current regulatory framework are required, ANZ
believes that a comprehensive and collaborative assessment of the impacts to customers
and participant business models be undertaken. Sufficient notice should be provided to
allow participants to plan their respective strategic responses and to mobilise resources to
make required system, process and commercial changes.
We are grateful for the RBA’s continued consultation with the industry and are available to
participate in working groups or in other ways to help share the future of payments in the
Australian market. We would be pleased to answer questions in relation to this submission.
The appropriate contact is Mr. Bob Belan, General Manager - Consumer Cards & Personal
Loans (Bob.Belan@anz.com, 03 8654 8291).
Yours sincerely
Matt Boss
Managing Director
Retail Products and Marketing, Australia
ANZ