ICCC warns merchants: ‘charging EFTPOS cash-back fees is illegal

The Independent Consumer and Competition Commission [ICCC] has warned businesses that charging customers fees for Electronic Funds Transfer at Point of Sale [EFTPOS] cash-back transactions is illegal and will attract regulatory action.

The warning follows numerous public complaints and preliminary investigations by the competition watchdog, which confirmed that some shops are imposing additional charges on customers using EFTPOS services.

ICCC Commissioner and Chief Executive Officer Roy Daggy said the practice is a clear breach of existing merchant agreements between banks and businesses.

“Increasingly, we are seeing customers being unfairly charged when they access their own money through EFTPOS machines. This practice is not allowed,” Daggy said in a public notice.

He said the ICCC is aware that the illegal charges are occurring in both urban and rural areas and stressed that enforcement action will be taken against non-compliant merchants.

Daggy confirmed that the commission has engaged Bank South Pacific and Kina Bank on the issue, with both banks agreeing to work closely with the ICCC to ensure merchants adhere strictly to EFTPOS merchant agreements.

In addition, the ICCC is collaborating with the Central Bank to introduce appropriate regulatory measures to further protect consumers and prevent unfair merchant trading practices.

Meanwhile, the public has been urged to remain vigilant and to immediately report any business houses that continue to charge EFTPOS cash-back fees, so appropriate action can be taken.