Online trader RedBalloon has been penalised $43,200 for charging four customers excessive fees for their payments with MasterCard and Visa debit and/or credit cards.
The online experience gift retailer―which sells experiences in Australia such as skydiving jumps, wine tours and cooking classes―was in breach of the new payment surcharges laws in the Competition and Consumer Act 2010, according to the Australian Competition and Consumer Commission (ACCC).
“RedBalloon was charging these customers more than allowed under the law prohibiting excessive payment surcharges on card transactions,” said ACCC deputy chair Dr Michael Schaper.
“This provides that businesses can only pass on to customers what it costs to accept the payment, including fees such as merchant service fees, and terminal rental and maintenance fees.”
The ban on excessive surcharges for large businesses such as RedBalloon came into effect more than a year ago on 1 September 2016, while for small businesses the ban commenced 1 September this year.
RedBalloon founder Naomi Simson.
“If a business wants to impose a payment surcharge on card transactions, that business is responsible for ascertaining the cost of acceptance of the payment before imposing the surcharge onto customers.
“If a business is unsure what the cost of acceptance is for a particular payment method, it should contact its financial institution to obtain a copy of its annual statement.
“The excessive payment surcharges provisions now apply to all businesses, big and small, in Australia. Any business charging excessive surcharges on card transactions, whether intentional or not, risks ACCC enforcement action,” Schaper added.
RedBalloon has since lowered its payment surcharges to the correct amounts.
This story was originally published by Giftguide.
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