NAB won't match ANZ's cheaper tap and go fees

Scott Barbour/Getty Images

The NAB is holding off following the ANZ to make it cheaper to use bank debit cards to make tap and go payments at shops, bars and restaurants.

The Australian Retailers Association estimates using the credit card system rather than EFPTOS debits from a bank account adds more than $290 million in costs.

NAB CEO Andrew Thorburn was questioned about the fees when he appeared before the House of Representatives Standing Committee on Economics which is conducting public hearings with Australia’s four major banks as part of its review of the banking sector.

Chair David Coleman said ANZ Bank CEO Shayne Elliott had last week agreed to allow any merchant with an ANZ-based terminal to have the cheaper default option of EFTPOS rather the more expensive credit network.

Coleman to Thorburn: “Will you match ANZ’s commitment?”

Thorburn: “No.”

On further questioning, Thorburn said: “The fees in question here are not set by the bank, they are mandated on a cost recovery basis by the RBA.”

Coleman then said: “Will you give those merchants, as is normal in markets, the capacity to choose to have the lowest cost option?”

Thorburn said it wasn’t simple to make such a change and ultimately the bank was taking a commercial risk.

The bank was also waiting for new data on the costs of such fees. The NAB believes that there is very little difference in tap and go fees between debt or credit cards in transactions below $50.

NOW WATCH: Money & Markets videos

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.