The Payment Systems Board of the Reserve Bank of Australia has published its Annual Report 2009. The report contains lots of interested data and graphs on payments behavior, interchange fees, merchant service fees, etc. in Australia.

The Reserve Bank of Australia has announced that it is "is considering changes to the regulation of interchange fees in the EFTPOS system. The proposed change to EFTPOS interchange regulation is intended to ensure that competition between EFTPOS and scheme debit is conducted on a level playing field. The change does not imply that interchange fees in the different systems should be equal, only that they are subject to equivalent regulation."

In a media release today, the Reserve Bank of Australia's Payments System Board announced that at a recent meeting it had considered whether the conditions have been met for the removal of interchange regulation and "was not yet satisfied that such conditions have been met." The Board also said it had decided to defer consideration of any further reduction in interchange fees for the time being. READ MORE

Neil posts on the Money.AU blog that the big four Australian banking groups are reviewing their overdraft fees "after their rival National Australia Bank (NAB) has decided to cease charging customers who end up overdrawing their bank accounts." The NAB said it will stop charging overdraft fees beginning October 1st.

PayPal Australia has announced "a new programme to help more organisations get online and take advantage of the Internet to open up new revenue streams. With e-commerce expected to continue to grow in the coming years, PayPal will launch a ‘Certified Developer and Partner Program’ to recruit developers and solution providers to help meet the growing demand for online payments outside of the retail sector. In addition, the company has made new tools and resources available to help organisations such as charities, foundations, schools and universities start accepting online payments and donations easily." READ MORE

Philip Lowe, Assistant Governor (Financial System) at the Reserve Bank of Australia, spoke today at the Cards & Payments Australasia 2009 conference being held in Sydney, Australia. In his speech, he addressed "firstly, the recent reforms of the ATM system; secondly, the conclusions of last year’s review of the reforms to the card payment systems; and thirdly, the architecture and governance of Australia’s bilateral systems." In his discussion of the reforms, he comments, in particular, about online payments:

The Bank’s recent focus on online payments reflects a couple of considerations. One is that in many situations, consumers wishing to buy goods online have few payment choices other than to use a card issued by the international schemes. This lack of choice weakens competition, and is likely to become a bigger issue as online commerce continues to grow.

Another consideration is that fraud rates on online transactions appear to be steadily increasing. Almost half the fraud on credit cards occurs in situations where the merchant does not physically see the card, with the fraud rate increasing by around 50 per cent over the past year. If this trend were to continue, it could undermine consumer confidence in transacting online which would have obvious costs.

The Reserve Bank of Australia's Payments System Board has announced that it has "recently been considering PayPal’s and eBay’s rules that prohibit merchants from surcharging customers for the use of PayPal and from discouraging the use of PayPal." Following its review, the Board said it was not going to impose any new regulation now on PayPal's practices because of PayPal's relatively small size in the online market. READ MORE

Telstra, National Australia Bank and Visa have reported on initial results from a three-month trial of mobile contactless payments at Melbourne’s Docklands. In the trial, consumers downloaded the NAB Visa credit card software application to their Telstra SIM remotely, and then used their mobile phone to purchase goods and services by waving their phone over a participating merchant’s Visa payWave enabled reader.

According to the companies, "the trial exceeded expectations, with a clear consumer demand emerging for contactless mobile payments and services during the trial, leading the three organisations to continue to explore opportunities in this area in the next few years." READ MORE

Australian payments technology provider Distra has announced it has "entered into a strategic alliance with National Australia Bank (NAB) to develop and promote a range of new payments products and services. NAB, a licensee of Distra’s payments switching application since June 2007, will invest an undisclosed amount to take a minority stake in Distra." READ MORE

The Australian Payments Clearing Association (APCA), the payments industry self- regulatory body in Australia, has released its latest fraud data for cheques, debit cards, credit and charge cards for the 12 month period ending 30 June 2008.

While Australia’s total rate of fraud remains low by global standards, the total rate of fraud (cheque and payment cards) has risen from 5.9 cents (2007) to 7.2 cents for every $1,000 of payments. Cheque fraud declined from 1.4 cents to 0.8 of a cent in every $1,000. Debit card fraud increased slightly from 7.1 cents to 7.4 cents in every $1,000. Credit and charge card fraud increased 30% from 38.6 cents to 50.2 cents in every $1,000 (5.02 basis points). READ MORE

Visa has announced details of a five-year agenda for Australia to strengthen the security of the payments system. As part of the agenda, Visa will engage in discussions with Australian financial and merchant communities to set deadlines for the implementation of seven key security initiatives. Visa says that "all of the initiatives will provide greater protection against fraud for cardholders, merchants and financial institutions, while some will also help to reduce the time it takes to make an electronic transaction." READ MORE

The Reserve Bank of Australia has announced the conclusions of its review of the payments system reforms undertaken by the Payments System Board. "In the Board’s view, the reforms have significantly improved competition in the Australian payments system. The reforms have liberalised access and removed restrictions on merchants that had weakened competition in the system. They have also increased transparency and have led to more appropriate price signals to consumers." READ MORE

In an article titled "Rapt in plastic", Lesley Parker writes for the Sydney Morning Herald about the growth in so-called "scheme debit cards" among Australian consumers. The story notes an analyst report finding that use of the debit cards has grown from 14 per cent in June 2005 to about 23 per cent now while there has been a gradual but persistent fall in credit-card payments from about 28 per cent to about 26 per cent over that same period.

The Reserve Bank of Australia's Payments System Board has announced that it will be pursuing reforms of some PayPal policies: "Over recent months, the Board has received a number of comments on the no-surcharge and no-steering rules that apply to payments using the PayPal system as well as the mandated acceptance of PayPal on eBay’s auction site. Where no-surcharge and no-steering rules have existed in other systems, the Board has encouraged their removal on the grounds that these rules can diminish competition in the payments system. Consistent with this, the Bank will shortly be holding discussions with PayPal with a view to seeking the removal of these rules."

YALAMANCHILI International and ANZ have announced signing a 5 year agreement for YALAMANCHILI to provide prepaid processing services to ANZ in the Asia Pacific region. The first prepaid card program issued under this agreement is the ANZ Stadium Visa payWave card. The card will be the first reloadable, prepaid contactless card in Australia and will be launched at ANZ Stadium in Sydney for the Bledisloe Cup on 26 July, 2008. READ MORE

ANZ and Visa have announced the launch of the first reloadable, prepaid contactless card in Australia. The new ANZ Stadium Visa payWave card will be launched at ANZ Stadium in Sydney where it will be offered initially to 2,000 ANZ Stadium members for use during the Bledisloe Cup on 26 July. READ MORE

Ina Steiner writes for AuctionBytes that eBay has cancelled plans to go to a PayPal-only marketplace in Australia following an inquiry by the Australian Competition and Consumer Commission that would have likely resulted in a ruling preventing eBay from doing so.

eBay Australia continues to require that all sellers offer PayPal for payment - but it won't be requiring removal of other payment methods. In a statement to the eBay community, eBay said "eBay regrets any uncertainty that this process has caused among the Community and believe that today’s decision will remove further doubt."

In April, the Reserve Bank of Australia released the preliminary conclusions of its 2007/08 review of the payments system reforms undertaken by its Payments System Board. Interested parties were invited to make written submissions by June 30th on these conclusions and the analysis underpinning them. The RBA has made those submissions available online.

Philip Lowe, Assistant Governor of the Reserve Bank of Australia, spoke earlier this month at a Visa forum on the subject of "The Preliminary Conclusions of the Payments System Review".

He says: "If there is a central message to my remarks ... it is that, while significant progress has been made in improving the competitive landscape in the Australian payments system, further progress is needed. Ideally, this progress would be made by industry participants. Reflecting this, the Board’s preliminary conclusions lay out some carrots and sticks that it hopes will promote industry-based reform. In the event that industry is able to respond and deliver a more competitive system, then the most contentious part of the reforms – the regulation of interchange fees – can be rolled back. On the other hand, if industry is either unable or unwilling to take the necessary steps, then the regulation of interchange fees is likely to continue, and these fees, particularly in the credit card system, are likely to be reduced further."

Stephen Hutcheon writes for the Sydney Morning Herald that eBay intends to "challenge the Australian competition watchdog's ruling to block a plan to force its users onto a PayPal-only payments system." Yesterday, the Australian Competition and Consumer Commission announced a draft notice proposing to prevent eBay from implementing a PayPal-only policy in Australia.

The Australian Competition and Consumer Commission has announced is has issued a draft notice proposing to revoke a notification by eBay International on 11 April 2008. Under the notification, eBay proposes to mandate the use of PayPal for almost all transactions on the eBay site. READ MORE

Ina Steiner notes on AuctionBytes that eBay Australia has filed its response to the many submissions received by the Australia Competition and Consumer Commission (ACCC) inquiry about eBay Australia's new PayPal-only policy slated to go into effect next month. More details about the inquiry and all of the submissions are available on the ACCC web site.

Suzanne Tindal writes for ZDNet.com.au about yesterday's announcement of SMS Banking by National Australia Bank (NAB) - noting that 1,100 users signed up in the first day the service was available. NAB's service, in addition to informational, supports transactions that move funds between the user's eligible NAB accounts. "Using SMS Banking is free until 1 November, apart from the cost of the SMS. After that an account balance enquiry will cost AU$0.25, a mini-statement AU$0.25, and a funds transfer AU$0.40." The NAB has a comprehensive FAQ on SMS Banking available.

Ina Steiner writes for AuctionBytes.com about new developments as eBay moves forward with plans to mandate PayPal on sellers in Australia. She cites several submissions to the inquiry into the practice being conducted by the Australian Competition and Consumer Commission.

The Reserve Bank of Australia has made comments to the Australian Competition and Consumer Commission's inquiry into eBay's recent announcement that it would mandate the use of PayPal for payments on eBay's Australian site. The RBA comments: 'The proposed conduct by eBay is to mandate the use of PayPal for almost all transactions on the eBay site. This raises three potential issues in relation to the payments system. The first is that it could limit the ability of new on-line payment systems to become established and for alternative systems to compete in the on-line payments space. The second is that it could restrict merchants' ability to negotiate lower fees. And the third is that it restricts choice for consumers.' More in the RBA's full submission. Also, CNN reports on eBay's move.

We mentioned the Pen or PIN program in Australia earlier today. The Pen or PIN website includes several resources explaining what's happening including a general backgrounder, one for retailers, another for cardholders, and an FAQ for media. "From 4 June 2008, most American Express, Diners Club, MasterCard and Visa cardholders will have the choice to use a Personal Identification Number (PIN) to authorise transactions when using these cards in person. The introduction of PIN on these cards follows an industry-wide collaboration involving all major banks, financial institutions and card schemes operating in Australia."

The Sydney Morning Herald reports on the "Pen or PIN" project underway in Australia that will allow shoppers using credit cards to either sign their receipts as they've always done or choose to use a PIN instead beginning June 4. A spokesman said: 'The introduction of PIN on credit and debit cards will give cardholders a quick and easy alternative to signature authorisation when making purchases in person.' Meanwhile, the Herald Sun reports that a consumer group is concerned that a move to PINs 'could result in consumers being unable to dispute credit charges.' More details here.

The Reserve Bank of Australia has released preliminary conclusions from its 2007/08 review of the payments system reforms undertaken by the Payments System Board. The Bank is now seeking submissions on these conclusions, before finalising the review later in the year. READ MORE

The Reserve Bank of Australia has published the Proceedings from its Payments Systems Review Conference held last November. 'The conference was designed to bring together a wide range of parties to discuss the reforms of recent years and how best to move forward. It was attended by around 90 invited participants, drawn from financial institutions, payment schemes, industry bodies, merchants, consultants, academia and public policy institutions.' The table of contents of the proceedings is here.

In an article titled 'ANZ starts rush to mobile banking', Mahesh Sharma writes for Australian IT 'ANZ is set to become the first bank in Australia to launch a mobile phone banking service and its competitors are expected to follow suit soon.' ANZ's offering will include both SMS-based information services as well as a Java-based mobile handset application.