RBA urges choice on dual network debit cards be retained for CNP transactions

In a recent email to the Australian payments industry about tokenisation, The Reserve Bank of Australia’s Head of Payments Policy, Dr Tony Richards, outlined the RBA’s view that the access and choice available to consumers and merchants on dual network cards be retained in the card not present environment.

Dr Richards’ email says: “The Reserve Bank understands that there are discussions in the industry regarding the tokenisation of cards-on-file as part of the initiative to reduce card-not-present fraud. The Bank supports this broad initiative.

“The Bank has been made aware of potential issues regarding the process of tokenisation of dual-network debit cards. Accordingly, I am sending this email to all major schemes and issuers to note the Bank’s support for the long-standing practice of issuing such cards in Australia, because they are convenient for cardholders and allow stronger competition between networks at the point of sale. For example, the Payments System Board has previously welcomed some undertakings in relation to contactless technology and other matters (August 2013) and mobile wallets (May 2017).

“Accordingly, the Bank would be concerned if, as plastic cards are supplemented by a variety of other means of accessing a customer’s account, any actions were taken by schemes or scheme participants that had the purpose or effect of diluting or preventing competition between networks, by removing choices previously available to cardholders and merchants. Specifically, the Bank would be concerned if scheme rules or policies on tokenisation limited the ability of merchants to choose to route card-not-present transactions through their preferred network.”