Australian businesses are paying $5.74 billion each year in excess foreign exchange fees, according to new research from Australian-born payments company, Airwallex.

The company is calling on the government to step in and direct the Australian Competition and Consumer Commission (ACCC) to prioritise this issue as the costs are hurting businesses and ultimately costing consumers.

Airwallex has undertaken specific calculations on the impact on the retail sector, finding retailers are being charged on average $45,279 in excess fees each year. This jumps to $49,180 for online retailers, compared with $5,786 across all types of businesses.

Businesses are paying on average 3.97% more for their foreign exchange fees with a bank, compared to Airwallex.

“I see it every day where businesses are paying an ‘inertia tax’ for not shopping around on who they use for their international transactions,” Airwallex account management lead, Nathan McNally said.

“Businesses are being rorted without realising it and it’s time for the government to step in. Businesses are feeling the crunch and consumers’ hip pockets are hurting. Simple changes like mandating more transparency in foreign exchange fees would have a deflationary effect by promoting competition.

“What can look like just a couple of cents of difference on the exchange rate adds up to big bucks out of your pocket. A whopping $5.74 billion cost to businesses is hiding in balance sheets in plain sight.

“Retailers are some of the worst-affected business types because of the nature of their operations where they need to buy materials and products from overseas, manage the freight and logistics of moving products around, and paying for marketing and advertising before they can even make a sale.

“At every stage of that process, someone is clipping the ticket with excess foreign exchange costs. Too often as businesses grow, they stick with the financial provider and the package they were offered when they started.

“In this inflationary environment, we know businesses have to fight to keep their products affordable despite rising costs and one of the quickest ways to do that is to shop around on your international transaction partner.”