A Variation to the Access Regime for the ATM System: Consultation Document – May 2012 The Proposed Approach

The Bank's preliminary view is that the exemption powers in the Access Regime may currently be too narrow. It has reached this preliminary view given that it is now aware that there may be possible circumstances where a participant may be both a payer and a receiver of interchange fees under one-way arrangements, where those circumstances are not contrary to the original intent of the Access Regime – namely to increase transparency in ATM fees to cardholders and to strengthen competition in the ATM industry.

The Bank therefore proposes to vary the Access Regime in order to expand its exemption power. This would enable it to grant an exemption to an ATM scheme for very remote Indigenous communities and any future arrangements that the Bank considers appropriate, having regard to the requirements of the Access Regime.

The draft variation to the Access Regime (in the Attachment with the proposed variations, including changed paragraph numbers, marked) extends the Bank's exemption power in paragraph 17 in order for it to permit a participant to be both a payer and receiver of interchange fees under one-way arrangements. That is, the Bank will have the power to grant an exemption from the requirements of paragraph 13 in addition to those of paragraph 12. The draft Access Regime would continue to require that, in deciding to grant an exemption, the Bank consider the public interest, the interests of current and potential future participants in the system and any other matters that it considers relevant.

The Bank must consider the same factors in deciding whether to vary the Access Regime in the manner described above. That is, under section 14(1) of the Payment Systems (Regulation) Act 1998, it must consider whether it is appropriate to vary the Access Regime, having regard to:

1. whether the variation would be in the public interest; and
2. the interests of current participants in the system; and
3. the interests of people who, in the future, may want access to the system; and
4. any other matters the Reserve Bank considers relevant.

The Board's preliminary view is that varying the ATM Access Regime to extend the Bank's exemption power in the proposed manner is likely to be in the public interest. This preliminary view is based on the following considerations. It would provide the Bank with the flexibility to facilitate an ATM scheme for very remote Indigenous communities in a timely manner, along with any other arrangements that in the future might be considered to be in the public interest. The interests of current and potential future participants in the system would continue to be taken into account under the varied Access Regime given that the varied Access Regime explicitly requires the Bank to consider these factors when making an exemption.