Australian Payments Board advances modernization and addresses system risks

The Payments System Board addressed several critical operational issues during its March meeting.

Members discussed the persistent challenges within Australia's cash distribution system, emphasizing the vital role cash plays for many Australians, particularly in regional and remote areas.

The Board expressed support for a proposed regulatory framework designed to ensure the long-term sustainability of these services, including crisis powers for public sector intervention to maintain continuity.

Furthermore, the Board reviewed the regulation of merchant card payment costs and surcharging, considering options for amending existing rules on interchange fees and fee transparency.

Members agreed to publish a Conclusions Paper and an implementation timeline for any regulatory actions by the end of March, aiming to enhance fairness and clarity in card payments.

The Board reviewed industry progress in modernizing the account-to-account (A2A) payments system.

While acknowledging initiatives and reduced short-term risks from the BECS decommissioning timeline adjustment, a significant concern remains: insufficient industry consensus on future bulk payment processing.

This lack of agreement is hindering effective decision-making and the enhancement of system resilience.

The RBA emphasized its readiness to take further action if industry participants fail to achieve coordinated progress in modernizing A2A payments in the public interest.

Additionally, the Board discussed Project Acacia's findings on tokenised asset markets, supporting public-private collaboration for responsible innovation, with its final report expected in late April.