Credit card rewards programs in firing line as banks recoup surcharge change costs | The Business

By ABC News (Australia)

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Banks are winding back rewards programs and insurance perks offered on credit cards, as they prepare for the biggest changes to payments in years. From Thursday, businesses will be banned from adding a surcharge to customers using electronic terminals to pay for goods on card networks including EFTPOS, Mastercard and Visa. The cap on interchange fees paid by Australian businesses to banks for processing credit card fees will reduce from 0.8 per cent to 0.3 per cent, meaning businesses will pay lower fees but bank revenues will take a hit. In preparation for these changes, the major Australian banks are increasing credit card fees, reducing reward program perks and cutting back on travel insurance inclusions. The surcharge ban is expected to save consumers about $1.6 billion and businesses $200 million in surcharge fees annually. Canstar's data insights director, Sally Tindall, said it was clear the banks were not willing to wear the reduction in interchange fees. "They're looking

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