Independent Payments Forum’s Post

Congratulations to Ellis Connolly and Payments System Board at the Reserve Bank of Australia who yesterday announced they'd kick off the long-awaited consultation on merchant card payment costs and surcharging. This will be a fantastic opportunity to highlight the massive cost of living implications caused by the disparity (about $1.7 Billion) between the fees charged to small businesses and their customers for everyday card payments, compared to big retailers. Conservatively, this problem costs every Australian family about $150 a year, but for some families it’s a lot more! It results in small business needing to surcharge to recoup costs. During the consultation, we can expect to hear a lot from vested interests in the payments industry blaming small business for surcharging, without acknowledging their role, offering solutions or dropping their fees. While this may not be the entire Review of Retail Payments Regulation we’ve been waiting for, it’s an important element that will allow the Board to focus on this key issue, while continuing to advocate for Least Cost Routing and a fair go for all Australian consumers and businesses. Independent Payments Forum Michele B. Brad Kelly Warwick Ponder Gabby Taylor Russell Zimmerman Peter Drennan Australasian Convenience and Petroleum Marketers Association (ACAPMA) AACS (Australian Association of Convenience Stores) Council of Small Business Organisations Australia (COSBOA) Luke Achterstraat Matthew Addison Mark McKenzie (BEng,MBA,GAICD) Theo Foukkare #CostOfLiving #Payments #LeastCostRouting #SmallBusiness Jos de Bruin Jerome Laxale MP

At our recent 𝘍𝘚𝘹𝘛 𝘊𝘰𝘯𝘯𝘦𝘤𝘵: 𝘙𝘦𝘨𝘶𝘭𝘢𝘵𝘰𝘳𝘺 𝘗𝘶𝘭𝘴𝘦 event, we sat down with Roger Nassrallah from the Bank of Canada (BoC) to discuss the implementation of retail payments supervision in Canada. Key takeaways included: 🔹 The best place to start assessing whether industry participants are in scope of the new regime is the BoC's website and advice from counsel 🔹 The BoC cannot inform an applicant about the outcome of their application during the period between November 1, 2024 to September 7, 2025 (unless the Minister of Finance issues a directive to the BoC to refuse to register an applicant) 🔹After September 7, 2025, the BoC will publish a list of registered PSPs and a list of refusals 🔹 Application approval timing may be affected by national security reviews, which are out of the BoC's control ❕ Also important to note that the BoC's consultation on its draft supervisory guidelines for payment service providers closes on May 21, 2024. This week is the last week to participate in the consultation. Gowling WLG | Bank of Canada | Roger Nassrallah | Alana Scotchmer | Parna Sabet-Stephenson | Adam Garetson

Are you ready for the RPAA!? If you're a part of the Canadian payments industry and fintech, I'm sure you've already heard of the Retail Payments Activities Act (RPAA). If not, check the following summary! The RPAA establishes the Bank of Canada as the regulator of payment service providers (PSPs) in Canada. Its goal? To safeguard end-user funds and protect the integrity of retail payments by: 1. Mitigating operational risks and ensuring a timely response to incidents. 2. Protecting end-user funds held by PSPs. Key Requirements for PSPs: 1. Register with the Bank of Canada between November 1-15, 2024, and pay a $2,500 fee. 2. After November 15, PSPs must: - Implement frameworks to handle operational risks. - Enable measures to safeguard funds. - Report serious incidents and significant changes regularly. Who Needs to Register? Canadian PSPs must complete the four-step application test (link https://lnkd.in/edkX6PDZ) to determine if they are required to register. Key consideration points: 1. Do you meet the definition of a PSP? Check the link: https://lnkd.in/eQjdaE59 2. Are you conducting retail payment activities in electronic fund transfers using fiat currency? 3. Are you within the Bank of Canada's geographical scope? 4. Are you subject to an exclusion from registration? Key Dates to Remember: - November 1-15, 2024: Set up your account on PSP Connect, submit the registration application, and pay the fee. - November 16, 2024 - September 7, 2025: The Bank will review applications, share them with FINTRAC and the Department of Finance, and publish the list of applicants. - September 8, 2025 onwards: Registration decisions will be announced. PSPs must then meet supervisory requirements around operational risks and fund safeguarding. Non-compliance Warning: PSPs that fail to register by November 15, 2024, will be deemed illegal. The Bank will remind non-compliant PSPs of the requirements and may impose fines up to $10 million. If you haven't already, now’s the time to assess whether you fall within scope and register! For further guidance on whether you need to register, use the Bank of Canada PSP assessment tool. #Fintech #Payments #RPAA #BankofCanada #Innovation #Compliance #PSP

Retailers bear the brunt: Why NZ needs to revisit card surcharges now 🚨 🤔 Why are retailers still paying extra fees to accept their customers’ own money? As the Australian government moves to ban debit card surcharges, there’s renewed hope that New Zealand could be next. 💥 BusinessDesk’s latest article digs deep into the current landscape, revealing the challenges and opportunities for change. 💥 The Commerce Commission’s review aims to bring more transparency and lower costs, as retailers currently absorb hefty fees—up to 60% of electronic transactions. 💥For many, especially smaller operators, this cuts into already slim margins of 3-4% 💥 Solutions like BNZ's Payap 👏👏 signal a potential shift towards more cost-effective, direct account-to-account payments. 💥 But to achieve meaningful change, NZ needs a fairer, more transparent payment system. Check out the article in the comments ⬇️ Great dive into the topic Gregor Thompson and BusinessDesk NZ #RetailNews #NZRetail #CardFees #BusinessDesk #Innovation

📦 Today, the Bank of Canada published ✨ new ✨ 𝘙𝘦𝘵𝘢𝘪𝘭 𝘗𝘢𝘺𝘮𝘦𝘯𝘵 𝘈𝘤𝘵𝘪𝘷𝘪𝘵𝘪𝘦𝘴 𝘈𝘤𝘵 (RPAA) guidance. The RPAA is Canada's new regulatory regime that will regulate payment service providers (PSPs) starting in November 2024. The new guidance includes: 📥 A supervisory policy on acquisitions of control and prescribed changes in respect of PSPs 📥 5 new case scenarios about retail payments including: holding funds, the securities exclusion, remittance service providers, e-commerce, payment gateways and acquiring services, and payroll services 📥 Changes to the Criteria for registering PSPs about: eligible financial contracts, securities transactions and designated systems 📥 A step-by-step video about registration under the RPAA Check out all of the new information on the Bank of Canada's website. Gowling WLG | Alana Scotchmer | Parna Sabet-Stephenson | Angelica Wilamowicz | Natalia Castro | #RPAA

The 2023 increase in of cash transactions in the UK, is well received by British merchants since cash payments help reduce their costs. In detail: 📈 Cash transactions in 2023 increased +4% (19%) vs 2022 (15%). 📉 In-store card transactions in UK decreased (-7%) vs. 2022 💶 Cash as a means of payment has reached pre-pandemic levels, allocated in smaller but more frequent purchases. ⚖ British Retail Consortium members committed to accepting cash payments, supporting vulnerable groups and those who use cash for better budgeting. ‼️ The UK Financial Conduct Authority(FCA), will also include measures to ensure access to cash throughout the country. Sources: https://lnkd.in/dw4hqcDY & https://lnkd.in/dZzgXGsJ #Retail #CashPayments #CashAcceptance #Euronet #ATM

This week I attended the Commerce Commission conference on competition in the personal banking market. Key points I shared with the attendees - The NZ banking industry has all the hallmarks of a market lacking competition; high barriers to entry, an uneven playing field and super profits for a few organisations at the top. I was surprised the major banks invested so much time in arguing the market is competitive. - Open Banking is not the "silver bullet" for increasing competition in NZ. In fact, I believe Open Banking will make little to no impact, and competition will not improve unless the following changes are made. 1. The Reserve Bank of New Zealand lowers barriers to entry. New entrants such as Dosh New Zealand must be allowed to enter and compete. Level the playing field for existing players. 2. There is an increase in capital funding for competitors. The total funding raised across all Fin Techs in NZ in 2023 was $20m. 3. The government appoints a regulator to oversee Open Banking. The current Payments NZ governance model is operating under material conflict of interest. And a few other points captured in this well written article by Rob Stock.... #openbanking #Bankingdisruption #digitalBanking

📣😎My awesome team at the Bank of Canada 🇨🇦 just published its Enforcement and Reviews policies (https://lnkd.in/gzsrjxX8). These policy documents will help regulated entities understand what happens once enforcement actions have been initiated, more specifically: 📌 what to expect (and is expected of affected parties) during the enforcement and #investigation process 🧑🏻💻🕵🏻♂️⚙️ 📌 an overview of our suite of tools to incentivize #compliance and what we consider when we select the appropriate tool 🥕🛠️ 📌 how administrative monetary penalties #AMPs will generally be assessed 🧮🧾 📌 the adjudicative process when making representations or seeking a review of certain Bank decisions ⚖️👨⚖️ 📌 a summary of the delegated #authorities made under the Retail Payment Activities Act 📚📝 ⏰ November 1, 2024 is fast approaching, and payment service providers are required to submit their registration application by November 15, 2024 ⏳🎯 You only get one shot at a first impression 👀 (🍝mom’s spaghetti) . . . . . #RPAA #retail #payments #supervision #regulations #financial #technology #fintech #cdnpoli #cdnecon #payment #service #providers #PSPs #supervisory #policy #framework #guidance #tools #enforcement #reviews #registration

The Reserve Bank of Australia #RBA today released a report analysing the benefits, design choices and challenges associated with linking #fastpayment systems across countries. The report finds that connecting fast #payment systems has the potential to considerably improve the #speed and #transparency of #crossborder payments, benefiting both end users and service providers. Crucial to realising these benefits are well-designed governance, scheme rules and payments processing capabilities, which help to manage risk and ensure a seamless cross-border payments experience. However, establishing an #interlinking arrangement poses challenges, including dealing with differences in #legal and #regulatory frameworks across participating jurisdictions and agreeing on governance arrangements and scheme rules. Linking national fast payment systems is receiving significant international attention as a promising way to improve the #crossborderpayments experience. In light of these developments and #Australia’s commitment to enhancing cross-border payments, the RBA recently collaborated with a number of Australian industry participants involved in cross-border payments to study the interlinking of fast payment systems. The report contributes to the international discussion on this topic and encourages further analysis of key design considerations. This work will also help inform future discussions in Australia about the potential for the domestic fast payment system, the New Payments Platform (NPP), to be linked to fast payment systems in other countries.

I would like to share what has undoubtedly been the big news in the sector this week. Major banks, the Australian Banking Association (ABA), and the largest retailers have reached a historic agreement with Armaguard to design a new financial viability model and ensure the safe development of the cash ecosystem across Australia. 🌏💰 Australia is creating a unique industry model, guaranteeing: • The industry is 𝗲𝗰𝗼𝗻𝗼𝗺𝗶𝗰𝗮𝗹𝗹𝘆 𝘃𝗶𝗮𝗯𝗹𝗲. 📍💵 • There are 𝘀𝗶𝗴𝗻𝗶𝗳𝗶𝗰𝗮𝗻𝘁 𝗶𝗺𝗽𝗿𝗼𝘃𝗲𝗺𝗲𝗻𝘁𝘀 𝗶𝗻 𝗽𝗿𝗼𝗱𝘂𝗰𝘁𝗶𝘃𝗶𝘁𝘆 𝗮𝗻𝗱 𝗲𝗳𝗳𝗶𝗰𝗶𝗲𝗻𝗰𝘆. ⚙️ • There is a 𝗰𝗮𝗽𝗮𝗰𝗶𝘁𝘆 𝘁𝗼 𝗶𝗻𝘃𝗲𝘀𝘁 in the industry. 💰 • The 𝗵𝗶𝗴𝗵𝗲𝘀𝘁 𝘀𝘁𝗮𝗻𝗱𝗮𝗿𝗱𝘀 𝗼𝗳 𝘀𝗮𝗳𝗲𝘁𝘆 𝗮𝗻𝗱 𝘀𝗲𝗰𝘂𝗿𝗶𝘁𝘆 are maintained. 📈 • The public has 𝗮𝗰𝗰𝗲𝘀𝘀 𝘁𝗼 𝗰𝗮𝘀𝗵 at the lowest possible price consistent with the commitments of security and safety. 🔒 • 𝗠𝗼𝗿𝗲 𝗲𝗳𝗳𝗶𝗰𝗶𝗲𝗻𝘁 𝗮𝗻𝗱 𝗽𝗿𝗲𝗱𝗶𝗰𝘁𝗮𝗯𝗹𝗲 𝗽𝗿𝗶𝗰𝗶𝗻𝗴 is achieved through the development of an independent pricing mechanism. 💡 🗣 “No other nation has major banks, retailers and key distribution companies working together to achieve a more efficient Cash-in-Transit industry. Armaguard is also leveraging the expertise of its other shareholder, Prosegur, which is one of the world’s leading cash companies” said Peter Fox, Chairman of ARMAGUARD. 🗣 “This deal will keep cash moving around the country and ensure it remains available to Australians wherever they live,” ABA CEO Anna Bligh said. 💼🤝This agreement between #Armaguard and a group of major banks and retailers reflects the fact that issues facing the sustainability of Cash-in-Transit services will only be addressed by the collective efforts of the relevant parties. https://ow.ly/Qu6n30sEy8p