RBA surcharge ban proposal spooks small businesses
In its own statement, the Australian Restaurant & Cafe Association said the proposal, as structured, would only force businesses to raise their menu prices — leaving customers no better off in the long run.
“Restaurants aren’t banks,” wrote CEO Wes Lambert.
“We simply can’t absorb thousands in hidden merchant fees.”
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The Australian Restaurant and Cafe Association slapped down the proposal, and suggested the ‘tone deaf’ policy would simply drive up menu prices.
‘Who the hell does the RBA think will bear the cost of this ridiculous decision?’ chief executive Wes Lambert said.
‘A blanket ban on surcharging will undermine small businesses, reduce price transparency and mandate price hikes across every menu in Australia.’
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The Reserve Bank has propsed an end to surcharges on all credit and debit card transactions leaving consumers at risk of wearing the cost.
Australian Restaurant and Cafe Association CEO Wes Lambert believes it will lead to higher menu prices to cover those lost surcharges.
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Australian Restaurant and Cafe Association chief executive Wes Lambert said while he appreciated the RBA was working to reduce merchant fees, its proposal added to small businesses’ expenses.
“(Businesses) who have always passed on the merchant fee directly to consumers, so therefore never had a merchant fee expense on their (income statement), will either be forced to absorb those new merchant fees . . . or they’ll have to pass those additional expenses that they’ve never had before onto their consumers in the form of increased menu prices,” he said.
“Consumers will end up getting screwed . . . consumers will pay more than $1.2b in increased menu prices.
“The RBA is sounding like a used-car salesman (by) trying to sell us a piece of junk as a brand new car.”
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Wes Lambert, the chief executive of the Australian Restaurant & Cafe Association, which represents many of the country’s hospitality venues, said there was no way that the RBA’s proposal would save consumers the $1.2 billion that the central bank had suggested on Tuesday.
“They’re kidding themselves,” he said, noting restaurants will still have to pass on other fees to consumers through higher menu prices. More than 80 per cent of cafes and restaurants pass on fees paid for credit and debit card payment services to consumers in full through surcharging.
“If the merchant cannot pass on any merchant fees to the consumer, what will the merchant fee have to be to that business for it not to have more expenses? Zero. Is the RBA suggesting that they will be zero? No,” he said.
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The Australian Restaurant and Cafe Association’s chief executive Wes Lambert warned the proposal would drive up menu prices.
“No matter how low merchant fees go based on the RBA’s intention to save businesses $1.2 billion, with no surcharging, businesses who previously paid net $0 in merchant fees, will now be faced with the bill,” he said.
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But the Australian Restaurant and Cafe Association’s chief executive, Wes Lambert, said the proposal would drive up menu prices across the hospitality industry.
“Who the hell does the RBA think will bear the cost of this ridiculous decision? First, merchants, and then customers,” Lambert said.
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The Australian Restaurant & Café Association said the wage hike would ultimately mean higher prices for customers.
“This wage increase is disconnected from the economic reality facing restaurants and cafés across Australia,” said CEO Wes Lambert.
“Inflation is moderating, productivity is in decline, and venues are barely breaking even – yet they’ve just been handed another cost increase they simply cannot absorb.
“Wage hikes without productivity growth are unsustainable. This will force venues to raise prices at a time when customers are already pulling back.”