Card merchant fee hike drives industry anger

SOME motor industry business owners are unhappy with plans to raise the merchant fees on the Motorcharge card by up to 60 per cent from June 5.

The Motorcharge system operates on a spread of rates, depending on how rapidly the retailer wished to be paid.

The old rates are understood to have ranged from 0.9 per cent to 1.7 per cent.

Its utility over other credit card offerings, such as the Shell and BP cards, came from the fact that it could be applied to almost all automotive needs.

It also meant that the user was not tied in to using just one brand of fuel outlet.

The card was once part-owned by the Motor Trades Association of WA as part of its affiliation with its national body but it sold the business to UK-based Retail Decisions last year.

Motor Trades Association executive director Peter Fitzpatrick admitted some of his organisation’s members were complaining about the increasing fees following the sale.

“I can’t comment on it due to a confidentiality agreement we signed when we sold our share in Motorcharge,” Mr Fitzpatrick said.

Independent fuel station owner Arthur Rosenwald said the decision to raise Motorcharge rates was another nail in the coffin for small business.

“With Visa we’re paying 1.4 per cent in merchant fees on each sale and that’s barely affordable,” Mr Rosenwald said.

“With my payment plan the merchant fees have gone up to 2.25 per cent.

“A lot of businesses may be forced to drop the card.”

Retail Decisions also runs the competing Motorpass card.

Motorcharge was also the service provider for the Gull fuel card and that service arrangement passed on to Retail Decisions.

Gull’s Graham Pember said service charges on the Gull card were not likely to rise.

“They (Retail Decisions) have increased the charge on the Motorcharge card but not on the Gull card,” Mr Pember said.