A growing chorus of Australians believe a cheaper digital payments system should be available as an alternative to heavyweights Visa and Mastercard.
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New research from payments provider eftpos has found an increasing number of consumers believe small businesses should have the ability to opt in for lower merchant fees through the Least Cost Routing network.
The response comes after Treasurer Josh Frydenberg urged the Reserve Bank to implement the LCR system to reduce costs and create a more equal playing field for businesses.
His comments regarding LCR have also been targeted towards tap and go payments being rewired through a cheaper debit transaction system, such as eftpos.
Currently, tap and go transactions incur higher transaction fees as the systems are put through as a Visa, Mastercard or American Express payments.
Eftpos says businesses having access to cheaper merchant fees has become increasingly important, due to nearly 70 per cent of transactions in 2020 being put through as electronic debit payments.
Eftpos chief executive Stephen Benton said Australians are becoming aware how important it is for a business to keep transaction costs down.
"The new survey found that 83 per cent of respondents now think it's important for merchants to be able to select the lowest cost network, a figure that highlights growing public awareness and concern over business costs in the COVID environment," Mr Benton said.
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It is understood eftpos would likely benefit from tap and go being put through the LCR network, as it is the lower cost Australian alternative to Visa and Mastercard.
Eftpos is co-owned by the major four banks and the two major supermarkets, and in 2020, conducted more than two billion debit transactions which equated to approximately $300 million in payments a day.
The Australian Competition and Consumer Commission has also approved a merger between eftpos, BPay and the New Payments Platform, to become a larger provider that can compete against the two US giants.
The research conducted by eftpos also coincides with a major changes payment methods, which in the past few years has seen the rise of new platforms such as buy now, pay later.
According to eftpos' survey, 45 per cent of consumers believed merchants would likely pass on any fee savings to customers.
Mr Benton also noted 66 per cent of Australians had no preference in terms of network provider, but would prefer a lower cost domestic alternative over more expensive international providers.
Council of Small Business Organisations Australia chief executive Alexi Boyd said lower merchant fees will assist in firms being able to keep costs down when selling goods and services.
"People know that small businesses are under intense pressure right now, and Australians clearly have a preference for merchants to choose their own destiny when it comes to debit card fees," she said.
