The bank said, from October, they will automatically route transactions for eligible small businesses and family enterprises between EFTPOS and international schemes so businesses don’t have to spend time managing their routing options. They will be offering 1.1% for all in-store card transactions, and 1.5% for online transactions, regardless of the interchange rate or the type of card (debit, credit or Amex). Customers will receive this automatically, without having to “opt in”.
“The overwhelming feedback from our small business customers is that they want simple, competitive pricing without the hassle. They want the benefit from least-cost routing without having to manage the routing themselves,” said James Fowle, executive general manager, Everyday Business Banking.
“Our new flat rates are designed to offer that by removing complex pricing structures and managing the routing of transactions for them. We’ll automatically and centrally route transactions in the most cost-effective and competitive way, saving businesses a lot of time and money.”
Bruce Billson, the Australian Small Business and Family Enterprise Ombudsman, welcomed the announcement, congratulating the bank for hearing their calls to slash the high costs associated with electronic card payments for smaller operators. This issue is particularly important given the recent rise in cashless, tap-and-go payments, especially when many small businesses are already operating on tight margins and battling disruptions from COVID, Mr Billson said.
“The cost of these higher and hidden charges across the economy is many millions of dollars — money that could be better put to work to grow business and employment prospects,” Mr Billson said. He also urged all banks and financial institutions to do the same.
Meanwhile, the Commonwealth Bank also said it will automatically waive three months of merchant fees for small businesses who have been hardest hit by the latest COVID lockdowns, saving them more than $7 million.
Mr Billson also commended this move, calling it a “terrific early Christmas present”.