20 November 2017

Red Balloon pays penalties for excessive credit & debit card surcharges

Source: Australian Competition and Consumer Commission (ACCC)

We recently issued 4 infringement notices to Red Balloon Pty Ltd for charging four of its customers excessive surcharges when making either credit or debit card payments. Red Balloon has paid the penalties totalling $43,200 for alleged breaches of these new laws.

Since 1 September 2016, a ban on excessive surcharges applied to large businesses in Australia. Red Balloon is classified as a ‘large business’. This ban now applies to all businesses both large and small.

The ban restricts the amount a business can charge customers for using an EFTPOS (debit and prepaid), MasterCard (credit, debit and prepaid), Visa (credit, debit and prepaid) and American Express cards issued by Australian banks.

As a business, you can only charge what it costs you to accept the payment when your customers are paying with card. Essentially the only costs businesses can include are external costs charged to you by your financial provider. You are responsible for determining the cost, which you can get from your financial institution.

Remember all businesses risk being investigated if they impose excessive surcharges.

Read our guide on payment surcharges to find out more about requirements for businesses.

For more information see our media release: Red Balloon pays penalty for excessive payment surcharges