Payments System Board Annual Report – 2005 List of tables

Table 1: Reform of Card Payments

Table 2: Credit Card Rewards

Table 3: Interchange Fees, August 2005

Table 4: Proposed Changes to Debit Card Interchange Fees

Table 5: Survey Respondents

Table 6: Use of Bill Payment Methods

Table 7: BPAY Interchange Fees

Table 8: CLS Currencies

Table 1: Reform of Card Payments
1999 2000 2001 2002
Credit Cards
Joint Study announced Joint Study released Bankcard, MasterCard and Visa designated Final standards and access regimes released
    Draft standards and access regimes released MasterCard and Visa mount legal challenge
Debit Cards
Joint Study announced Joint Study released   EFTPOS industry working group formed
      EFTPOS discussion paper released
Table 1: Reform of Card Payments (Continued)
2003 2004 2005
Credit Cards
No surcharge rule abolished Access regime comes into force Steering restrictions removed in three-party schemes
Case by MasterCard and Visa heard Merchant service fees published Common interchange benchmark proposed
APRA announces regulatory arrangements for Specialist Credit Card Institutions (SCCIs) First SCCI announced Market shared published
Case by MasterCard and Visa dismissed    
Interchange standard comes into effect    
Merchant service fees fall    
Debit Cards
Banks seek ACCC authorisation of zero interchange in EFTPOS Visa Debit designated Draft standards for EFTPOS and Visa Debit released
Banks and APCA to address access to the EFTPOS system EFTPOS authorisation overturned by ACT Merchants' EFTPOS designation challenge heard
EFTPOS authorisation granted EFTPOS designated Access code for EFTPOS agreed
Authorisation appealed by merchants EFTPOS designation challenged by merchants Access regime imposed on Visa Debit system
Table 2: Credit Card Rewards
Average spending
required for $100
voucher ($)		 Benefit to
cardholder as a
proportion of
spending (bp)
2003 12,400 81
2004 14,400 69
2005 15,100 66

Sources: Banks' websites. ANZ Telstra/Rewards Visa card, Commonwealth Bank MasterCard Awards card, National Australia Bank Visa Gold card and Westpac Altitude MasterCard.

Table 3: Interchange Fees, August 2005
Per cent of transaction value
Bankcard MasterCard Visa
Standard 0.49 0.62 0.60
Electronic 0.49 0.46 0.44

The electronic rate applies to transactions where the card is swiped and the signature verified. The standard rate applies to most other transactions, including those using manual processing and those over the internet or telephone. MasterCard and Visa also have separate interchange fees for commercial cards.

Sources: Bankcard, MasterCard and Visa websites.

Table 4: Proposed Changes to Debit Card Interchange Fees
Revenue to issuer: cents per transaction
EFTPOS Visa Debit* Difference
Current −20 +40 +60
Proposed −5 +15 +20

*For transaction of average size.

Source: RBA

Table 5: Survey Respondents
Industry Billers
surveyed		 Number
of bills % of total
Councils 4 1
Financial services 5 8
Government 10 14
Telecommunications 5 49
Utilities 15 25
Other 1 2
Total billers 40 100

Source: RBA

Table 6: Use of Bill Payment Methods
Method Rank of importance – number of billers
1 2 3
Direct to biller
Cash 2 2 2
Cheque 1 4 3
Credit card or
charge card		 10 12 7
EFTPOS 0 0 0
Direct credit 0 1 1
Direct debit 3 5 6
Through an agent
Third party      
over-the-counter 23 8 3
BPAY 0 7 16
Locked box 1 1 2
Total 40 40 40

Source: RBA

Table 7: BPAY Interchange Fees(a)
Paid by biller's institution to payer's institution
$ % of
transaction
value
Capture reimbursement fees
From deposit account 0.44 –
From credit card account 0.38 0.27
BPAY View fee(b) 0 –

(a) Excluding GST.
(b) Paid where payer's institution has implemented BPAY View.

Source: BPAY

Table 8: CLS Currencies
Currency Joined CLS
Australian dollar September 2002
Canadian dollar September 2002
Euro September 2002
Japanese yen September 2002
Pound sterling September 2002
Swiss franc September 2002
US dollar September 2002
Danish krone September 2003
Norwegian krone September 2003
Singapore dollar September 2003
Swedish krona September 2003
Hong Kong dollar December 2004
Korean won December 2004
New Zealand dollar December 2004
South African rand December 2004

Source: CLS Bank