Australians will feel the impact of the upcoming new credit card interchange regulations — we’re a nation of points junkies with 11 million Qantas Frequent Flyers * alone. But while everyone’s thinking about how the reverberations of these changes affect consumers, it’s easy to forget that new interchange rates raise a number of big questions for business cardholders in particular.
Business-to-business (B2B) payments are becoming one of the fastest growing revenue streams for the likes of American Express, Visa and MasterCard. Yet, relatively few businesses currently use their commercial cards to pay suppliers for a fairly obvious reason: high interchange rates that make purchases prohibitively expensive.
The Reserve Bank of Australia’s (RBA) decision on credit card surcharge rates changes this. According to the RBA, the cap offers relief to the many businesses that bear the brunt of interchange costs, compared to larger merchants who often benefit from low rates on their card transactions already. By capping all interchange rates at 0.8 per cent, it can provide a shot in the arm that will see businesses increasingly take up commercial cards as a payment option for suppliers.
Change Afoot for Credit Card Interchange: What the New Rates Mean for Small Business
By Brad Kean
Australians will feel the impact of the upcoming new credit card interchange regulations — we’re a nation of points junkies with 11 million Qantas Frequent Flyers * alone. But while everyone’s thinking about how the reverberations of these changes affect consumers, it’s easy to forget that new interchange rates raise a number of big questions for business cardholders in particular.
Business-to-business (B2B) payments are becoming one of the fastest growing revenue streams for the likes of American Express, Visa and MasterCard. Yet, relatively few businesses currently use their commercial cards to pay suppliers for a fairly obvious reason: high interchange rates that make purchases prohibitively expensive.
The Reserve Bank of Australia’s (RBA) decision on credit card surcharge rates changes this. According to the RBA, the cap offers relief to the many businesses that bear the brunt of interchange costs, compared to larger merchants who often benefit from low rates on their card transactions already. By capping all interchange rates at 0.8 per cent, it can provide a shot in the arm that will see businesses increasingly take up commercial cards as a payment option for suppliers.
Australians will feel the impact of the upcoming new credit card interchange regulations — we’re a nation of points junkies with 11 million Qantas Frequent Flyers * alone. But while everyone’s thinking about how the reverberations of these changes affect consumers, it’s easy to forget that new interchange rates raise a number of big questions for business cardholders in particular.
Business-to-business (B2B) payments are becoming one of the fastest growing revenue streams for the likes of American Express, Visa and MasterCard. Yet, relatively few businesses currently use their commercial cards to pay suppliers for a fairly obvious reason: high interchange rates that make purchases prohibitively expensive.
The Reserve Bank of Australia’s (RBA) decision on credit card surcharge rates changes this. According to the RBA, the cap offers relief to the many businesses that bear the brunt of interchange costs, compared to larger merchants who often benefit from low rates on their card transactions already. By capping all interchange rates at 0.8 per cent, it can provide a shot in the arm that will see businesses increasingly take up commercial cards as a payment option for suppliers.