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Australia banks need to do more on payments, cross-border fees-RBA

Published 10/12/2019, 09:51 am
Updated 10/12/2019, 09:56 am
© Reuters.  Australia banks need to do more on payments, cross-border fees-RBA

SYDNEY, Dec 10 (Reuters) - Australia's central bank wants to see the country's banking industry roll out new payments platforms at a faster rate and to reduce fees on some products, particularly for the high cost of sending money across international borders.

Reserve Bank of Australia (RBA) Governor Philip Lowe noted the price of sending money out of Australia has been consistently higher than the average for the rest of the G20 nations.

"In nearly every case, the major banks are more expensive than the digital money transfer operators (MTOs)," said Lowe. "For the major banks, the average mark-up over the wholesale exchange rate is around 5.5%, versus about 1% for the digital MTOs."

This was a particular problem for countries in the South Pacific that rely on receiving remittances from family and friends in Australia and New Zealand.

Lowe listed a range of areas where the RBA wanted to see more progress from the banks, including portable digital identity services, improving operational resilience and expanding the services offered by the country's new payments platform (NPP).

After a slow start in early 2018, the NPP has seen monthly transaction values and volumes triple over the past year and the take-up rate is now faster than in most other countries with such systems.

Lowe also said regulators were considering whether there was a case for rationalising Australia's three domestically focused payment schemes - BPAY, eftpos and NPPA.

A long-term decline in the use of cheques meant that, at some point, it would be appropriate to wind up the cheque system entirely, Low added.

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