NEW RESEARCH reveals Australian consumers are overwhelmingly in favour of small businesses being given the ability to choose the cheapest option to process debit card payments through Least Cost Routing (LCR).

Eftpos CEO Stephen Benton said, “The new survey found that 83 percent of respondents now think it’s important for merchants to be able to select the lowest cost network, a figure that highlights growing public awareness and concern over business costs in the COVID environment.

“The new research shows that Australians clearly recognise and identify with the pressures small businesses face, and the importance of keeping their costs down”. 

The cost of debit card fees is now critical to small business because they have replaced cash as by far the most common way to pay in Australia, representing nearly 9 billion – and almost 70 percent – of total electronic retail transactions annually. 

The new research shows an eight-point rise since the previous survey three years ago, a jump that demonstrates that consumer support for Least Cost Routing (LCR) has moved up the agenda for everyday shoppers and gained their widespread support.

It also suggests that consumers are increasingly understanding the potential economic benefits to be gained from LCR, with 45 percent of consumers stating that merchants were likely to pass on any fee savings to their customers, up 12 points since the last survey.

Publicly supported by Treasurer Josh Frydenberg as a key competitive mechanism to help level the playing field between small businesses and their larger peers with more market power, LCR lets merchants decide what payment ‘rails’ debit card transactions run down based on the lowest cost.

Mr Benton said the research also showed, that when asked about which payments network Australians would prefer to process their online or tap debit card transactions, 66 percent of consumers have no preference in network or would prefer to use the low-cost Australian eftpos network, rather than international schemes.

Of those that nominated a network preference, eftpos was the preference for 28 percent, with Visa and Mastercard only being preferred by 20 percent and 15 percent respectively.

The vast majority cardholders (91%) believe merchants processing via the eftpos network would not have a negative impact on their payment experience online or instore. 

The research findings echo ongoing public support expressed via an online petition on Least Cost Routing, which has now been signed by over 15,000 people. 

The petition is supported by a leading group of influential industry organisations including the Australasian Convenience and Petroleum Marketers Association (ACAPMA); Australian Association of Convenience Stores (AACS); Australian Chamber of Commerce and Industry (ACCI); Australian Lottery and Newsagents Association (ALNA); Council of Small Business Organisations Australia (COSBOA); Franchise Council of Australia (FCA); Institute of Certified Bookkeepers (ICB); MGA Independent Retailers / Timber Merchants Association (TMA); National Retail Association (NRA); and the Restaurant & Catering Industry Association of Australia (R&CA).

COSBOA CEO Alexi Boyd said she was pleased to see increasing public backing of the need for small businesses to keep their costs down.

“People know that small businesses are under intense pressure right now, and Australians clearly have a preference for merchants to choose their own destiny when it comes to debit card fees – whether it’s in stores, on mobile or online,” Ms Boyd said.

About eftpos 

Eftpos is Australia’s debit card system, processing over 2 billion debit card transactions in 2020 worth an average of more than $300 million each day. www.eftposaustralia.com.au

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THE Joint Select Committee on Road Safety will hold further public hearings for its Inquiry into Road Safety on October 6 and 7.

The hearing on October 6 will be an opportunity for the committee to hear from industry participants, regulators, and peak bodies about road safety in the workplace, with a focus on the heavy vehicle and freight sector, and the gig economy.

Committee Chair, Darren Chester MP, said, "Vehicle use is by far the most significant contributor to work-related trauma. Over 60 percent of worker traumatic injury fatalities involve a vehicle.

"With the expanding gig economy, we are likely to see increases in deaths and serious injuries on our roads unless measures are taken to enhance workplace road safety. Also critical to reducing road trauma is understanding the causes of heavy vehicle crashes, and designing measures to enable heavy vehicles to share our roads safely with other road users.

"Accordingly, the hearing will be an opportunity for the committee to hear about issues facing Australians who use the road as a workplace and measures that may be taken in this area to improve road safety outcomes."

The hearing on October 7 will be an opportunity for the committee to hear from research institutions, as well as peak bodies in the medical and law enforcement sectors, about impacts of road trauma on first responders and medical professionals and measures that can be taken to enhance post-crash response.

Mr Chester said, "In addition to the long-lasting impacts on victims, families and communities, road trauma has a hugely significant impact on first responders, emergency services personnel and medical staff. Post-crash care — including emergency treatment, trauma care and rehabilitation — is also a key pillar of the Safe System approach and is critical to achieving our ambitious 'Vision Zero' targets.

"Accordingly, the hearing will be an opportunity for the committee to gather valuable evidence in relation to the impacts of road trauma on first responders and the medical sector, and the measures that can be taken to reduce the impacts of road trauma through enhanced post-crash care."

Public hearing details

Date:               Wednesday, 6 October 2021
Time:              9.30am to 4.15pm

Witnesses:     

National Heavy Vehicle Regulator
Uber
Chartered Institute of Logistics and Transport
Deliveroo
Australian Trucking Association
National Road Transport Association
Toll Group
Australasian New Car Assessment Program (ANCAP)

Date:               Thursday, 7 October 2021
Time:              9.30am to 3.15pm

Witnesses:     

Royal Australasian College of Surgeons
Australasian Trauma Society
Injury Matters
Australian Road Research Board
Police Federation of Australia
Centre for Accident Research and Road Safety – Queensland

Due to health and safety concerns relating to the COVID-19 pandemic, hearings will be held remotely via videoconference and will not be open for public attendance. However, interested members of the public will be able to view proceedings via the live webcast at aph.gov.au/live.

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THE financial services industry is in the process of implementing one of the most significant and wide-ranging set of reforms ever for the sector.

Financial Services Council (FSC) CEO Sally Loane said the largest of all these reforms, the mandatory Design and Distribution Obligations (DDO), starts on Tuesday, October 5, and should improve consumer outcomes in financial services.

The DDO regime requires financial services businesses to determine which type of customers are in the target market for the products they issue, and work together so that sales are directed towards customers in that target market.

“The FSC recognised the significance of the DDO changes early, given we have members across many affected sectors. Two years ago we set out to design a set of tools to enable alignment and efficiency for businesses in the DDO regime,” Ms Loane said.

“The most important of these tools are the FSC’s target market determination templates and data standards for superannuation funds, platforms and wraps, life insurers and fund managers.

“These templates and standards will make life much easier for product issuers, platforms and financial advisers who would otherwise face confusing and inconsistent compliance requirements. More than 280 non-FSC members have purchased our templates under licence," Ms Loane said.

“We are confident that the FSC, working closely with our members, has done as much as we can to help businesses transition to the new regime. We are also pleased ASIC has said it will take a ‘reasonable approach’ to the start of the regulations, which should assist businesses as they adapt.

“The red tape burden from this raft of reforms is significant and can add to the cost of delivering products and services. We look forward to continuing to work with Government and ASIC on ways to improve consumer benefits and reduce red tape.”

The FSC has also helped its members in life insurance, fund management, superannuation and financial advice with other financial sector reforms, many of which deliver on Royal Commission recommendations, and are taking place on consecutive working days. These include:

• Individual Disability Income Insurance reforms, starting October 1;
• Reference checking and information sharing, starting October 1;
• New breach reporting requirements, starting October 1;
• Duty to take reasonable care not to make a misrepresentation, starting October 5;
• Anti-hawking reforms, starting October 5;
• Deferred sales for add-on insurance, starting October 5'
• Internal dispute resolution, starting October 5.

About the Financial Services Council
The Financial Services Council (FSC) has more than 100 members representing Australia's retail and wholesale funds management businesses, superannuation funds, life insurers, financial advisory networks and licensed trustee companies. The industry is responsible for investing almost $3 trillion on behalf of more than 15.6 million Australians. The pool of funds under management is larger than Australia’s GDP and the capitalisation of the Australian Securities Exchange and is the fourth largest pool of managed funds in the world.

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KEY INDUSTRY players, peak bodies and stakeholder groups will discuss major infrastructure projects and procurement when they appear before the House of Representatives Standing Committee on Infrastructure, Transport and Cities at videoconference public hearings on Tuesday, October 5 and Thursday, October 14.

The committee will examine the challenges and opportunities for the construction industry that comes with the Australian Government’s $110 billion commitment to the major infrastructure projects pipeline over the next decade.

Committee Chair, John Alexander OAM MP, said, "While the major infrastructure projects in the pipeline will play an important part in Australia’s economic recovery, the committee recognises that it will also place considerable demands on the construction industry and may exacerbate challenges the industry is already facing, including productivity and skill shortages.

"The key focus of this inquiry is how to improve procurement practices for government-funded infrastructure. Through strategic, effective and efficient procurement practices, governments can: help ensure the delivery of quality projects and value for money; drive important industry changes; and maximise opportunities for Australian businesses."

The public hearings will include panel discussion sessions on key themes. On October 5 selected groups will focus on issues in the construction sector, including driving cultural change. At the October 14 panel session, the committee will explore technology and digital delivery themes with industry groups.

"The committee looks forwards to hearing from these construction and engineering companies, industry peak bodies and stakeholder groups on what is working well in project procurement and delivery, and how the Australian Government can help drive necessary change and grow Australia’s sovereign industry capability," Mr Alexander said.

The terms of reference and submissions received are available on the committee’s website.

Public hearing details

Date: Tuesday, 5 October 2021
Time: 9.15am to 5.30pm
Location: Videoconference

Date: Thursday, 14 October 2021
Time: 9.15am to 5.15pm
Location: Videoconference

Programs for the hearings are available on the Committee’s website.

Due to health and safety concerns relating to the COVID-19 pandemic, this hearing is not currently scheduled to be open for public attendance. Interested members of the public will be able to view proceedings via the live webcast at aph.gov.au/live.

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