tyro

Electronic payments provider Tyro says consumers stand to save hundreds of millions of dollars in excessive fees if card companies all act to limit merchant charges.

Mr Stollmann says Visa informed his company 11 days ago that it was going to act to restrict surcharging to as little as 1 per cent, but he says many retailers may still be unaware of the change.

"How are retailers going to prepare for the change, adjust their systems and train their staff in time to avoid breaking their obligations under their contracts?" he asked rhetorically.

"How will retailers deal with customer complaints about surcharging, when they have not been given time to prepare for the change?"

Hefty credit card surcharges could be on the way out after Visa became the first company to ban Australian retailers from slapping on the fees.

The new rules follow a Reserve Bank of Australia and give credit card companies the power to force retailers to limit what they charge consumers to use credit and charge cards.

Tyro Payments said more than 36 per cent of Australian businesses, or 100,000 companies, impose some type of surcharge on a customer's bill, leaving 64 per cent or 200,000 - the majority - doing the right thing.

Hefty credit card surcharges could be on the way out after Visa became the first company to ban Australian retailers from slapping on the fees.

Among the biggest culprits accused of using surcharges as a revenue source are taxi companies, who place a 10 per cent surcharge on customers who pay with their credit card.

Airlines and large retailers with market power have also been accused by consumer group Choice of over the top fees.

HEFTY credit card surcharges could be on the way out after Visa became the first company to ban Australian retailers from slapping on the fees.

However independent eftpos provider Tyro Payments says the major banks were also to blame, imposing unnecessary fees on struggling small retailers, who then pass the costs onto customers.

"The truth is many small businesses are being forced to fund the lucrative loyalty programs of the major banks, by absorbing these costs," Tyro spokesman Mr Jost Stollmann said in a statement.

Credit card giant Visa will give consumers some relief from surcharge fees racked up for putting their purchases on plastic.

From today, all businesses that accept Visa cards for transactions have been told they can only charge customers the "reasonable cost of acceptance" - how much their bank charges them to process a
transaction.

"If all credit card companies follow Visa and outlaw excessive credit and debit card surcharging, it will save the Australian consumer an estimated $350 million a year," chief executive Jost Stollmann said.

CONSUMERS will no longer have to pay excessive fees every time they use their VISA cards, saving them an estimated $100 million per year.

VISA has announced that from today all businesses that accept Visa cards in face-to-face transactions must restrict any surcharging to as little as 1%.

“If all credit card companies follow VISA and outlaw excessive credit and debit card surcharging, it will save the Australian consumer an estimated $350 million a year,” Tyro Payments CEO Jost Stollmann said.

“From next week, retailers will need to review their surcharging practices to make sure their surcharges are not excessive and that they are clearly disclosed upfront to customers, both in-store and online,” Mr Kalra Visa’s Country Manager for Australia said.

Visa has developed a program to help retailers to comply with the new rules. This includes a special calculator, available through the retailers’ banks, to assist retailers determine their “reasonable cost of acceptance” as defined by the RBA.

“It will take a little time for retailers to review the new rules and implement them. We will monitor the situation closely to see what effect the changes have on surcharging levels,” he said.

Proposed reforms to the cab industry could see Australians enjoy cheaper cab fares, with the 10 per cent card surcharge for taxi journeys slashed to 5 per cent.

The Reserve Bank of Australia (RBA) is currently deciding whether to open up the Cabcharge system to competition for the first time in 36 years by regulating the Cabcharge system as it does the Visa, MasterCard and eftpos payment schemes.

“Single integrated EFTPOS terminals with real-time processing of all cards including Cabcharge will eliminate the industry’s rampant fraud problem perpetrated with paper vouchers and unauthorised transactions,” Stollmann said. 

EFTPOS services provider, Tyro, claims that consumers could soon enjoy an estimated financial windfall of $350 million a year, after proposed new rules allowing
the banning of excessive credit and debit card fees.

Under the proposed new consumer credit rules, to be brought in by the Reserve Bank from 18 March, credit card companies will have the power to force retailers to limit what they can charge
consumers to use credit and debit cards.

Stollmann said the changes would benefit consumers, but the major banks had a responsibility to help bring down costs for struggling retailers. 

CONSUMERS could soon enjoy an estimated financial windfall of $350 million per year, thanks to new rules allowing the banning of excessive credit and debit card fees.

From March 18, the Reserve Bank of Australia is giving credit card companies the power to force retailers to limit what they can charge consumers to use credit and debit cards.

Tyro Payments CEO Jost Stollmann said the changes would benefit consumers, but the major banks had a responsibility to help bring down costs for struggling retailers.

Independent eftpos provider Tyro Payments has vowed to step up its fight against the big banks, after revealing it surpassed $3.5 billion in credit and debit card transactions in 2012.

Stollmann says Tyro will continue to invest in new payment solutions.

“We have a cloud-based architecture in-house, so we are an ideal partner for all the point-of-sale vendors who will introduce cloud-based solutions,” he says.

Catching a taxi is a regular part of day to day life for business people and a major expense for companies. Jost Stollman from Tyro Payments explains how it could get a whole lot cheaper in the future.

Tyro Payments is the only independent EFTPOS provider in Australia competing “heads-on” with the big bank oligopoly. For us momentum is building to have a crack at one of Australia's longest standing monopolies, Cabcharge, a company surcharging Australian cab users with 10 per cent since 36 years when paying their cab fare with a card.

Tyro and its business partner CabFare provide their own efficient real-time payment solution in thousands of cabs. Four times in recent years, Cabfare has requested Cabcharge grant access to processing Cabcharge’s proprietary cards and was repudiated every time. As a consequence, CabFare has submitted a request to the Reserve Bank of Australia (RBA) to subject the $1 billion per annum Cabcharge payment processing business to regulation so as to open the market for competition. This would significantly benefit Australian business and consumers.

Independent EFTPOS provider, Tyro, has thrown down the challenge to Australia’s big banks, surpassing $3.5 billion in credit and debit card transactions last year and claiming to have introduced innovative systems and thinking while the banks operate “antiquated systems like the Leyland P76.”

According to Tyro, the value of transactions increased by 51 per cent last year compared to 2011, and have risen 145 per cent year on year since 2007, supposedly as retailers and customers flock to their “innovative payments system”.

Tyro’s latest half yearly financial results show a profit of $1.2 million and a revenue increase of 44 per cent to $19 million in 1H2012/13, up from only $335,777 in the corresponding half of 2007/08.

Tyro Payments is finally trading in the black, more than seven years after setting out to penetrate the business of processing credit and debit card payments for merchants.

Tyro yesterday publicised some financial highlights for the half year to December 2012. Its net profit was A$1.18 million on turnover of $18.7 million.

Australia’s big banks are on notice to lift their performance after the country’s only independent EFTPOS provider, Tyro Payments, surpassed $3.5 billion in credit and ebit card transactions in 2012.

More than 7,300 businesses have turned their backs on the big banks and opted for a Tyro system.

Tyro’s latest half yearly financial results show a profit of $1.2 million and a revenue increase of 44 per cent to $19 million in 1H2012/13, up from only $335,777 in the corresponding half of 2007/08.

Queensland’s 1,200 hotel owners and operators have a critical decision to make in the next three months that will fundamentally determine whether they keep their customers happy.

From April 1, all customers with Visa credit cards will be forced to leave their seats and pay for their meals at the cashier using a four digit code, or in a minority of cases the payment terminal will come to them at their table.

The solution is to use a secure Internet based integrated pay at the table solution. In layman’s terms, that means a wireless payment terminal that wait staff can take to the customer at their table, which communicates to the restaurant or hotel management system.

AN UPCOMING overhaul of the nation's credit card surcharging system will result in customers coming out on top.

Consumers will be charged less when they use plastic to pay for goods and services, under new standards introduced by the Reserve Bank of Australia.

Jost Stollman, chief executive of financial institution Tyro Payments, says that consumers will end up the winners.

"From March 18, Visa and MasterCard can limit to ensure their card transactions are not surcharged more than the reasonable cost," he says.

Tyro has a history of successfully challenging the big bank oligopoly.

Momentum is building to have a crack at one of Australia's longest standing monopolies, Cabcharge surcharging Australian cab users with 10 percent since 36 years when paying their fare with a card.

Tyro and CabFare provide their payment solution in thousands of cabs.

CabFare has submitted a request to the Reserve Bank of Australia to subject the $1 billion per annum Cabcharge payment processing business to regulation so as to open the market for competition.

Tyro Payments Ltd  another EFTPOS services provider  and their partner CabFare have submitted a formal request to the Reserve Bank of Australia to regulate Cabcharge and force it to lift a ban on its in-cab machines being used to process payments for other firms.

Tyro Payments chief executive Jost Stollmann said: "It's a scandal how Cabcharge is allowed to stifle competition and gouge the Australian consumer."

Opening the payment processing and metering system to third parties would give the country's 65,000 taxi drivers and millions of passengers "dramatically better service at lower costs".

The Reserve Bank of Australia has shied away from more burdensome regulation of the retail payments system, following a report into a raft of "operational incidents".

Stollmann said he would welcome an engaged regulator that put pressure on the major retail banks to eliminate the frequent collapses of the retail payment system.

Tyro has adopted what RBA calls the most reliable — and costly — form of back-up: duplicating systems in parallel, on an "active-active" basis.

"Going the extra mile delivers 100 per cent system availability." 

The Reserve Bank of Australia (RBA) published yesterday results of its informal consultation into the failings of the banking industry.

“The RBA analysis confirms that for too long, banks have prevented innovation and investment in Australia’s payment infrastructure,” said Mr Jost Stollmann, CEO of Tyro Payments.

Independent payment processing company, Tyro payments offers its 7,000 business customers the non-stop payment operation that the RBA describes as best practic.

Retailers worried about disruptions or delays caused by their incumbent EFTPOS provider now have a reliable alternative. Banks need to keep up or lose the business. It is not rocket science,” Mr Stollmann said. 

The Australian Federal Police said information from 30,000 of the Australian credit cards was used to conduct fraudulent transactions worth more than A$30 million.

Reports yesterday said all the 100 Australian businesses caught up in the fraud have been told how their systems were hacked, and all have now installed security measures that will prevent them being exploited again.

But the affected businesses appear not to have protected their customers’ data with end-to-end encryption while sending the data to payment processors.

Merchants’ contracts with banks require that they encrypt customer data using the Payment Card Industry Data Security Standard (PCI DSS).

The Payments System Board has concluded its review of the regulatory framework for the EFTPOS system. It has decided to move the regulation of bilaterally negotiated EFTPOS interchange fees to a basis that is consistent with other EFTPOS interchange fees and those of the international debit schemes.

Under current benchmarks, this means that bilateral interchange fees can be up to 12 cents paid to the issuer and any amount paid to the acquirer. The Board has also made an in-principle decision to revoke the existing Access Regime for the EFTPOS system if satisfactory access arrangements are put in place by eftpos Payments Australia Limited (ePAL).

These changes are intended to enhance competition between EFTPOS and the international debit schemes by placing them on a more consistent regulatory footing.

Australians are expected to dump cash in favour of convenient ‘tap and go’ credit and debit card purchases to beat the crowds this Christmas shopping season, with the number of contactless terminals tripling in the last year alone.

The cards reduce the standard waiting times at busy check out queues to as little as 6.4 seconds.

“The stress of Christmas shopping crowds, and queues, is expected to be easy this year for millions of Australians who are riding the ‘tap and go’ payment revolution,” says Jost Stollmann, CEO of Tyro Payments.

“Looking for coins and waiting for change is out this year.” 

Tyro has a history of successfully challenging the big bank oligopoly.

Momentum is building to have a crack at one of Australia's longest standing monopolies, Cabcharge surcharging Australian cab users with 10 percent since 36 years when paying their fare with a card.

Tyro and CabFare provide their payment solution in thousands of cabs.

CabFare has submitted a request to the Reserve Bank of Australia to subject the $1 billion per annum Cabcharge payment processing business to regulation so as to open the market for competition.

It is estimated that Australians spent approximately $4.6 billion on cabs in 2011 from 209 million separate journeys. In addition, customers pay 10 per cent in a cab every time they use a credit, debit or Cabcharge card, yet only pay between zero and three per cent in a shop.

Commenting, Jost Stollmann CEO of Tyro Payments, said: “It is a scandal how Cabcharge is allowed to continue to stifle competition and gouge the Australian consumer.

“The payment system in cabs is more expensive than in a retail store, but there is no justification for the 10 per cent. Every man, woman and child in Australia take more than 15 taxi journeys a year on average, so the stakes are high,” he said.

Australians could soon enjoy cheaper cab fares with the 10 per cent card surcharge they pay for taxi journeys slashed to 5 per cent, under wide ranging reforms to the cab industry.

The fee cut depends upon a decision by the Reserve Bank of Australia (RBA) to open up the Cabcharge system to competition for the first time in 36 years.

The RBA is currently considering whether to regulate the Cabcharge system as it does the Visa, MasterCard and eftpos payment schemes.

The Reserve Bank of Australia emphasises the right of merchants to recover their card acceptance costs through a surcharge, while allowing card schemes to address cases where merchants are surcharging at a higher level than is warranted. The Standards allow the card schemes to limit surcharges to ‘the reasonable cost of acceptance’.

It is the Bank's expectation that merchant service fees and other costs payable to acquirers will typically represent the bulk of the reasonable cost of card acceptance for merchants and that no additional verification should be required for surcharges set at this level.

National Billing Group and its CabFare payment system filed an application for the designation of the Cabcharge Payment System with the Reserve Bank on 16 November 2012.

In 2010 the ACCC prosecuted Cabcharge in the Federal Court. Despite being fined $14m by the Federal Court, it has been business as usual at Cabcharge. It has steadfast refused to meet with CabFare about processing Cabcharge Cards despite CabFare’s repeated overtures in the past 2 years.

In the past, the RBA has intervened to stop payment system inefficiencies and provide open access. If the RBA agrees to CabFare’s application it will deliver innovation, competition, and lower taxi fares.

The 10% service fee charged since 36 years is exorbitant and the only way of addressing this is through competition. CabFare tried unsuccessfully on 4 occasions to get access to the Cabcharge payment system.

Cabcharge is a $435m card business that operates without any Government scrutiny at present.

Now is the time for the RBA to bring this card into line with cards such as Mastercard and Visa so that passengers "pay a fair price for a fare service".

Tyro was recognised with the prestigious Deloitte Technology Fast 50 award.The program recognises and profiles fast growing Australian technology companies, which are ranked based on percentage revenue growth over three years (2010 to 2012).

The program includes the following related industry sectors:

• Communications/networking
• Software
• Semiconductors, components and electronics
• Life Sciences
• Internet
• Computers and peripherals

Given the opportunity, innovation and adaptability will win out over deep pockets every time, reckons Tyro Payments chief executive Jost Stollmann.

Testing this theory, Stollmann is competing for a cut of the tightly held debit and credit card transaction processing market, a market where the big four Australian banks are dominant players.

As a nimble new entrant in the payments space - Tyro now employs 70 staff - Stollmann believes Tyro can innovate in ways the banks and incumbent organisations cannot.

When we started CabFare we did so with a clean sheet. We came from outside the industry. We listened to people in the industry, talked to passengers, operators and drivers.

Innovation and change is in our DNA. With Tyro, our payment partner, we will challenge the existing payment paradigm with its reliance on paper and plastic.

Our aim is to make payments and taxi travel safer, simpler and more secure for all.

Tyro was recognised for the third time in a row with the FAST 100 award by BRW.

The survey ranks Australian companies with more than $500,000 turnover and 200 or fewer full-time employees according to their annual revenue growth in the three years to June 30, 2012.

The Fast 100 is in its 23rd year. Tyro is among only 13 companies that have stayed on the list of fast growth companies for three years and more.  

The days of signing your name to verify your identity when shopping with a credit card could be numbered, with credit giant Visa deciding to phase out pens in favour of PINs.

"Right now you're used to putting your credit card into the black folder and then expecting the waiter to take it and process it," said Garry Duursma, vice president at eftpos services company Tyro.

Mr Duursma said abandoning signatures will reduce the incidence of card-based fraud, although it could potentially open a new risk if the restaurant's eftpos system isn't properly integrated with the restaurant's bank account system.

All plastic transactions on Visa cards will soon require a four-digit code, with customers no longer able to sign for purchases.

Independent Eftpos company Tyro Payments' spokesman Garry Duursma said it's a significant change to the way customers pay for things.

Mr Duursma said consumers would notice a significant change when dining out, with the use of credit cards requiring a signature a common way to pay for meals.

For generations now diners have been used to receiving their bill in a little black folder, usually emblazoned with the logo of a global card brand.

That is about to change. Visa announced the change for 1 April 2013. Then consumers will be forced to leave their seats and pay for their meals at the cashier using a four digit code, or in a minority of cases the payment terminal will come to them at their table.

Having spotted the opportunity to innovate a new entrant into the electronic card payment space (Tyro) has worked closely with the industry and the key software providers to develop Australia’s first and only, all IP based, integrated “pay at table” solution.

The Reserve Bank of Australia (RBA) has established a team of five to work towards a central payment hub that will eventually facilitate real-time fund transfers between different banks.

Speeding up such types of payment transfers was one of the goals set by the RBA in its Strategic Review of Innovation in the Payments System report, which was released in June.

Tyro Payments now processes 1 million of Medicare Easyclaims every month, an extraordinary 500% increase in only three years.

For the past five years, Tyro has been working exclusively with the largest provider of practice management software; Health Communication Network, offering Integrated Medicare Easyclaim to PracSoft and Blue Chip subscribers. 

In July 2012, Tyro released integrated Easyclaim with Medilink. Other integrations will be following shortly, including integration with Practice 2000 and Best Practice.

“We were a start-up banking institution competing with an established oligopoly in the core banking space.”

“We did not have a second of failure of our systems last year, so we achieved 100 per cent reliability,” Jost Stollmann says. A $30 million investment in this “mission critical” infrastructure is the reason Stollmann says Tyro avoided any service outage.

Keeping up with the pace of new technology is the challenge, and that means hunting down talented developers to join the team.

“We’d love to double our development team,” Stollmann says. “We are looking for top-notch developers but it’s a very difficult market because of the demand. There is so much cool technology coming down the pipeline and we want to be the first to use that in many ways.”

It seems that every week there’s a new company, startup, or financial institution that is launching a new way to pay from, issue rewards, or power transactions from a mobile phone.

The question that always lingers in my mind when I see yet another mobile payments service pop up—how many more ways do we need to pay for a physical or digital product via a mobile device?

Just listing them is exhausting.  And we haven’t even touched the ever-growing number of startups that are playing in the space as well.

Tyro fully agrees with the RBA's strategic objectives but is very concerned with the long deadlines afforded to an industry with a notoriously underperforming implementation track record.

Tyro fully supports the Payment Systems Board’s preference for a consultative approach in setting the strategic goals and objectives as well as overseeing delivery but is very concerned with the history of continuous delays in implementing the overdue innovations of the payment infrastructure.

In light of the Australian oligopolistic industry structure as well as the industry’s culture and track record, Tyro recommends the RBA to provide increased infrastructure.

The Reserve Bank of Australia (RBA) has backed eftpos’ claims that its major payment systems rivals, Mastercard and Visa, are engaging in anti-competitive behaviour with the promotion of their debit cards.

The Australian Financial Review reports that Mastercard and Visa are unfairly blocking eftpos transactions, by removing the eftpos branding from their debit cards and by routing all ‘touch-and-go’ payments through the ‘credit’ system.

THE battle for technology supremacy between Australian banks is accelerating, with the industry preparing for an era in which cash matters less and transactions occur in real time anywhere.

For the banks, no matter how many consumer-focused apps they release, real-time banking will be constrained by their lack of innovation, said Jost Stollmann, chief executive at integrated payment software company Tyro Payments.

''Behind the innovative facade, the banks still use the mainframe batch system,'' Mr Stollmann said. Mainframes are still used by a large number of organisations even as mobile and cloud computing takes hold.

Australia’s four major banks and Woolworths and Coles will be the only beneficiaries if new regulations of the eftpos payment system are allowed, Tyro Payments warned.

The independent eftpos provider said under the proposal the major banks and retailers will be allowed to negotiate special deals that will benefit only themselves, while having the option to charge small and medium sized retailers at higher fees to use the eftpos network.

Australia’s four major banks and Woolworths and Coles will potentially be the big beneficiaries if a new regulation of the EFTPOS payments system is allowed to proceed, the country’s only independent EFTPOS provider warned today.

Under the proposals, the major banks and retailers will be allowed to negotiate special deals for themselves, while charging small and medium sized retailers higher fees if they wish.

This is because the big four banks and Woolworths and Coles through their ownership in eftpos Payment Australia Limited (ePAL) are being given the freedom to just do that.

With a growing number of retailers moving from traditional bricks and mortar into multichannel retailing, the risk of a data breach was greater than ever before.

A recent report from the Ponemon Institute said almost 40 per cent of global data breaches are caused by negligence. The average cost of a data breach to Australian companies is about $2.16 million per incident.

“Such figures are alarming and could possibly wipe out some smaller retailers as well as cause a lot of brand damage to larger ones. Retailers will be surprised to learn the extent of damage a data breach can cause the industry.

“Criminals are constantly looking out for vulnerable businesses, especially those with credit card data, to conduct fraud instantly using that data. Last financial year the Australian Payments Clearing Association said the cost of card fraud in Australia was $273 million.

A level playing field is good for competition, but then the Australian banking market is - in every other respect - heavily skewed towards the Big Four. So why should we expect different behaviour when it comes to payments?

For the Big Four, it makes some sense to invest in their own payment systems, and use that as another differentiator between themselves to build competitive advantage.

As the RBA's Tony Richards said just last month: "market forces might not be sufficient to produce innovation in the public interest."

Atlassian sells $100m worth of software a year in 130 countries around the world, but has no sales staff.

Now Atlassian - a billion-dollar business built by two Sydney friends in an apartment and then an office above a sex shop 10 years ago - is widely tipped to be the first Australian tech startup to go public during the current boom.

"I don't think we're graduating anywhere near enough computer science grads in australia. We should be doing 10x what we're doing today in terms of proportion." says co-founder Mike Cannon-Brookes

The Reserve Bank of Australia has announced it will intervene in the $400 billion a year credit card and eftpos market to force the country’s major banks to provide consumers and retailers with a better deal.

Following a two year review the RBA concluded that Australia’s major banks must be forced to invest further in Australia’s ‘cashless society’.

“For Tyro this is a major promise. We are the only new entrant into the EFTPOS system in 14 years. If the new payment infrastructure is delivered, there should be many more and we would have proven a point: leading innovation and competition can happen here at home,” says Jost Stollmann.

Ten years ago, many consumers were using credit cards as though they'd never have to pay them back.

Now because consumers have been startled by the global financial crisis, many feel insecure and prefer the more conservative approach of using their own money, knowing they are debt free.

The arrival of simpler payment methods, such as Tap and Go, means people are using debit cards for simpler - and smaller transactions, Mr Stollmann said.

There’s no doubt it takes effort to keep Australia’s payment system on the tracks, but the efforts by a range of industry bodies, including APCA, to ‘explore innovation’ often do read like a Douglas Adams novel.

The problem for APCA, and more broadly, the major banks, is that there’s plenty of people now making a career out of innovating around the industry’s corroding payments pipes.

This includes people like Tyro Payments founder Jost Stollmann, who has again delivered the industry a reality check by reminding APCA that debit card growth is already driving Australia towards a cashless society, and the bigger issue for the boffins at APCA and is lifting the resilience and security standards of payments systems.

Debit card use in Australia is rocketing by more than double that of credit cards, indicating consumers are spooked by debt and preferring to shop with their own cash, new figures reveal.

Tyro Payments CEO Jost Stollmann said the trend away from unsustainable spending habits of the past was likely to accelerate.

“Ten years ago, many consumers were using credit cards as though they’d never have to pay them back,” he said.

“Now because consumers have been startled by the global financial crisis, many feel insecure and prefer the more conservative approach of using their own money, knowing they are debt free.”

A survey from business banking research firm East & Partners of 1,500 businesses has revealed that 25 percent of all Australian enterprises with an annual turnover of between A$1-$530 million have experienced a significant technical failure with their primary transaction banking services in the last six months.

Not surprisingly, given their market share position and transaction volumes, the Big Four banks were the most susceptible, with 46.3 percent of all respondents experiencing technical failures coming from National Australia Bank (NAB), followed by Westpac (17.1 percent), ANZ (12.1 percent) and CBA (10.9 percent). Only 2.8 percent of businesses banking customers reporting technical failures were transaction banked by an international bank.

More transparency in the Australian EFTPOS system is needed, according to Tyro Payments.

“It’s ironical that the major banks want more control over Australia’s payment system when their own payment systems have failed nine times since August 2010, leaving consumers and retailers unable to transact.”

“The big banks behind ePAL are unsuited to be entrusted with this role. They obviously act in the profit maximizing interest of their shareholders, not in the public interest,” he said.

Tyro has launched integrated EFTPOS for iPhone and iPAD in the Australian market.

According to a survey conducted by Motorola Solutions (that is the other Motorola business Google isn’t buying) says that retail, hospitality, and field service industries are looking forward to replacing the old, clunky and fixed point-of-sale systems with mobile point of sale systems.

"The marriage of computing and connectivity without the shackles of being tethered to a location is one of the biggest disruptive forces of modern times. It is (and will continue) to redefine business models, for decades." says Om Malik from gigaom.com  

Eftpos recently launched a campaign telling consumers that by using the payments system they become “kings” of their own money. Interestingly, amid this regal pitch to convince more consumers to push cheque or savings instead of credit, eftpos may be eyeing another crown and lay claim over the technology that looks set to revolutionise the  way we make payments.

Tyro payments founder Jost Stollmann has lashed out at the submissions made by Commonwealth Bank and Westpac to the enquiry.

According to Stollmann, the banks are lobbying to gain more control over eftpos and that if they do, retailers and consumers will bear the brunt.

A fault line has emerged between Australia's major banks and independent payment providers over the future of Eftpos (electronic funds transfer at point of sale) regulation in Australia.

"Given that ePAL is dominated by four institutions it is far more dangerous to step back from regulation regarding ePAL than it would ever be with Visa and MasterCard. Those schemes have broad boards and a broad shareholder base. So I'm arguing that you can't entrust the Australian payments system to ePAL because you're effectively handing it to the four majors," Stollmann said.

"Anybody who is concerned about having the four banks running the show would not be very happy with the first option — i.e., the RBA using an Eftpos definition that is akin to ePAL."

Outsiders to the existing Eftpos club are calling for a broader definition of the debit payments system in Australia if the Payments System Board opts to update (rather than abandon) its "designation", or regulation, of this ubiquitous form of payments.

Tyro Payments argued that the Eftpos system should be defined "by a broader definition that recognises the interests and roles of participants and users of Eftpos that are not members of ePAL."

A long-standing critic of bank practices in the payment sector, Tyro wrote that "self-regulation is ineffective in an oligopolistic industry… It is only the RBA that has such powers and the legal obligation and perspective to act solely in the public interest.

Most consumers are unaware that eftpos Payments Australia Limited (ePAL) is majority owned by Australia’s major retail banks.

In a submission to the Reserve Bank of Australia the Commonwealth Bank and Westpac have asked the regulator to step back from eftpos regulation and allow ePAL, the very industry organisation in charge of eftpos, to rule themselves on access and interchange fees.

“They must be kidding,” Jost Stollmann, CEO of Tyro Payments, Australia’s only independent payments operator said.

“That is like the four foxes in charge of the hen house. Consumers and retailers will bear the consequences. They will continue to be underserved and overcharged.

Australia’s major banks are demanding more power to self-regulate the EFTPOS industry, despite evidence showing consumers and retailers are being badly short-changed by the current regime.

"They must be kidding,” says Jost Stollmann, CEO of Tyro Payments, Australia’s only independent payments operator. "That is like the four foxes in charge of the hen house."

"We cannot leave the field of payments to the big banks. Consumers, retailers, associations have to raise their voice, get involved, speak up!"

As far as EFTPOS is concerned, nobody but the Reserve Bank of Australia should mandate the outcomes, standards and access of the payment system.

The big banks behind ePAL are unsuited to be entrusted with this role. They obviously act in the profit maximizing interest of their shareholders, not in the public interest.

ePAL’s rule setting is not transparent nor inclusive of merchants and consumers, except Coles and Woolworths, who obviously look after themselves.

“How would ePAL be able to fairly balance its major shareholders’ interest with those of the community and those of new entrants bringing disruptive innovation to the payment space?” asks Jost Stollmann.  

Millions of accounts may have been hacked by cyber criminals, allowing them to access the Name, Card Number, Expiration Date, and cvv2 (3 or 4 digits on the back) on credit cards.

Australia’s leading independent payments provider, Tyro Payments, today warned Australians to urgently check their bank statements.

“Previously Australia was thought to be ‘lucky’ due to its geographical distance from other countries that experienced higher fraud incidents,” Mr Stollmann said.

However, international travel and the advancement in technology have meant that Australia has become a prime target for fraud offenders, as evidenced by the rise in plastic card fraud. 

Australians who have made an online purchase from the United States in recent months are being warned to check their credit card statements for possible fraud, after widespread abuse was uncovered overseas.

Millions of accounts may have been hacked by cyber criminals, allowing them to access the Name, Card Number, Expiration Date, and cvv2 (3 or 4 digits on the back) on credit cards.

This allows them to forge cards and fraudulently use them at ATMs and EFTPOS terminals.

Platinum credit cards are being used to grow interchange fees, writes Michael Evans.

They are the carrot often used to lure customers to decide between competing home loans by the big banks: the platinum or upmarket credit card with bonus rewards and exclusive access. They can arrive unsolicited in the mail as an upgrade to a loyal customer deserving of a new platinum status symbol.

The Reserve says that while the behaviour by the banks is legal, the trends ''add to costs on the acquiring side of the market and, if sustained, could put upward pressure on some merchant service fees over time''.

“While many of the details remain unclear, the one certainty is that the new eftpos arrangements will damage the viability of thousands of small and medium sized businesses. There has been little transparency on the part of ePal, the organisation which operates the eftpos system, nor from its members which include the banks, the credit unions and Woolworths and Wesfarmers.”

"According to one source, charging instead of paying for EFTPOS, could result in independent retailers facing additional EFTPOS charges of up to 18 cents per transaction. Small and medium retailers cannot absorb such costs.”

The average organizational cost of data breaches has decreased for the first time in seven years, according to a study released by Symantec and the Ponemon Institute on Tuesday.

In 2011 the average cost of a data breach was US$5.5 million, 24 percent less than in 2010, according to the 2011 edition of the annual "U.S. Cost of a Data Breach" study. The cost per compromised record has also decreased, by 10 percent, and stands at $194.

Currently there are four areas of retail payments regulation where the RBA is in various stages of public consultation: surcharging, innovation, regulatory framework for the eftpos system and retail payments system resilience.

What ties all of these things together is the focus on efficiency and competition. In many ways competition is working well to deliver benefits to end users. But in an industry of complex network interactions like this one, there is an important role for regulation in promoting efficient outcomes.

The online payment systems of Australia’s major banks have collapsed an astonishing nine times in the past 18 months, leaving millions of customers and businesses stranded from their funds, analysis by Tyro Payments has found.

The outages affect a range of services including ATMs, online banking and credit card and debit card transactions.

“It is not rocket science. Retailers worried about disruptions or delays caused by their incumbent EFTPOS provider now have a reliable alternative. Banks have to perform or lose the business,” Mr Stollmann says.

More than a million merchant locations, or about 10% of the nation’s total, now have some form of breach protection through their acquirers, according to the best guess by Robert Halsey, president of Royal Group Services Ltd. LLC, a Troy, Mich.-based insurance brokerage specializing in the payments industry. That figure has grown from perhaps 30,000 in early 2008, Halsey estimates.

Merchants typically pay $6.95 to $9.95 a month, says Halsey.

Commonwealth Bank's ATM and eftpos services have crashed across Australia, with the bank scrambling to fix the problem.

The bank was flooded with complaint calls this morning, with many customers unable to withdraw cash using ATMs or pay using eftpos.

Australia's banks continue to grapple with service issues around their ATM and eftpos - electronic funds transfer at point of sale - technology with National Australia Bank suffering an outage that knocked their services offline two weeks ago.

Today's extra day in February has caused the payment system used by the health industry to crash, preventing 150,000 customers from using private health care cards for medical transactions.

National Australia Bank-owned Health Industry Claims and Payments Service (HICAPS) warned customers they may encounter troubles with the terminals used at medical and insurance offices today.

The HICAPS failure follows problems at Commonwealth Bank, which saw its ATMs and eftpos systems fail earlier today.

APRA has "zero tolerance when customer data is at risk".

David Pegrem, Head of IT risk at APRA says, we want to remind institutions against undertaking aggressive cost cutting that may undermine the progress made in the last few years on improving availability and resilience.”

Pegrem summed up his presentation by reminding the audience that “there is an expectation of high availability and high resilience.

“There is no tolerance for known single points of failure, for poorly mapped business processes, for lost or poorly knowledge retention, for fixing bandaids rather than root cause solutions.”

Woolworths’ trials two large billboards in city train stations that contain images and barcodes for mobile phone scanning. The Woolworths mobile app allows customers to browse, scan, order and pay for products via their mobile for delivery to their home or office.

Woolworths says since it launched its mobile app in August last year more than 1.5 million Australians have downloaded it. The new app will take the data Woolworths can collect about customers to a new level, by allowing people to connect their Everyday Rewards membership to their mobile shopping.

More targeted offers are the obvious first port of call for Woolworths, but imagine what could be done if Woolworths took all of the data on purchasing behaviour and was able to combine it with location-based data, website browsing history, and spending pattern data.

Jost Stollmann, CEO of independent eftpos provider Tyro Payments said, each time a glitch occurs in the system, it can have a negative impact on retailers.

“Small businesses are severely impacted, when shoppers abandon their trolley and walk away. They lose hundreds of dollars in no time, not to mention the havoc and customer dissatisfaction. What is at stake is the reliability of the retail payment system with more than $400 billion spent annually,” he said.

“It is not rocket science. Retailers worried about disruptions or delays caused by their incumbent eftpos provider now have a reliable alternative. Choice and competition is good!”

The Reserve Bank of Australia says it will formalise the process in which banks need to report “significant instances” of technical problems.

The news comes in lieu of a slew of banking malfunctions. In the past three weeks, Bank of Melbourne, St George Bank and NAB have reported technological issues with either their websites or banking platforms.

In a statement, Mr Stollmann said that banking malfunctions that impact EFTPOS machines have a roll-on effect to retailers, not just impacting profit, but also damaging a consumer’s confidence in a retailer.

BANK customers left stranded without access to their bank accounts when computer systems fail now have an ally in the Reserve Bank.

Following a spate of information technology collapses that have left customers without access to crucial ATM, online banking and EFTPOS facilities, the Reserve Bank said yesterday it was investigating the sources of disruption, and examining whether banks were doing enough to prevent them.

"The RBA's patience with disruptions seems to run out and rightly so," said Jost Stollmann, chief executive of Tyro Payments, a provider of EFTPOS services to businesses.

When bank computers crash, consumers nationwide are left without ATM, online banking and EFTPOS service, unable to access the funds in their accounts. This has happened again and again.

Today, the Reserve Bank of Australia announced that the RBA and APRA would consider ‘strengthening the handling of any future disruptions’.

Tyro, the only independent provider of EFTPOS merchant services, delivered 100 per cent system availability(2) with its technology, multiple switches and data centres.

The Reserve Bank has responsibility for promoting an efficient and stable payments system. In light of continued rapid growth in the value of payments settled across electronic retail payments systems, and following a number of operational incidents, the Payments System Board noted in its Annual Report 2011 that the Reserve Bank and the Australian Prudential Regulation Authority would consider possible approaches to strengthening the handling of any future disruptions.

Tyro Payments CEO Jost Stollmann said today Australia’s big banks had failed to sufficiently improve electronic and online payments, despite demands to do so from the Reserve Bank and the Payment System Board over recent years.

The Payment Systems Board has the power to drive the innovation agenda by setting the required performance and access standard as well as incentives and penalties for the industry.

Another potential money-saving solution is to switch your EFTPOS provider altogether. Australian company Tyro (www.tyro.com) is offering an alternative service to ePal. It promises lower costs for small businesses including a zero joining fee (for ventures with a prior EFTPOS facility) and reduced ongoing charges: for example, it has a $0 chargeback fee (when a card holder disputes a transaction) compared to the market average of $27.

A COMPUTER crash has left NAB customers nationwide without ATM, internet, telephone and EFTPOS banking, and unable to withdraw funds from their accounts.

"We can confirm that NAB is currently experiencing technology system problems and as a result customers are unable to successfully transact using a range of NAB banking channels including ATMs, EFTPOS, HiCAPS, internet banking and telephone banking," the statement said.

A small celebrity-friendly restaurant in Utah is finally doing what many merchants have only dreamed of doing for a long time — taking on a part of the payment card industry’s powerful but flawed system for securing card data by fining merchants for failing to secure their data.

Stephen and Theodora “Cissy” McComb, owners of Cisero’s Ristorante and Nightclub in Park City, Utah, allege that the bank, and the payment card industry (PCI) in general, force merchants to sign one-sided contracts that are based on information that arbitrarily changes without notice, and that they impose random fines on merchants without providing proof of a breach or of fraudulent losses and without allowing merchants a meaningful opportunity to dispute claims before money is seized.

It’s the first known case to challenge the heart of the self-regulated PCI security standards.