Aust, banks to drop Visa

Press, 29 October 1981, Page 4

Aust, banks to drop Visa

NZPA Sydney The Australian banking industry has withdrawn .its Bankcard credit card system from international affiliation with the Visa and Mastercard groups, citing the threat to Bankcard’s ultimate survival. . The chairman of the Australian Bankers’ Association, Mr V. E. Martin, said that the . decision had been taken after it became “increasingly apparent that the major United States-based global charge card systems have

been adopting strategies designed to increase their influence world-wide.” Under the rules of both Visa International Services Association and Mastercard International Inc. Australian banks could be required to promote the foreign cards against Bankcard, he said. “Having pioneered and developed Bankcard in Australia, at a very substantial cost, the banks are not prepared to allow the Bankcard system, which has been widely adopted by both consumers and merchants throughout Australia, to be submerged or to lose its identity to global systems controlled overseas,” Mr Martin said. New Zealand banks had no plan to follow suit, said the chairman of the New Zealand Bankers’ Association; Mr R. M. Humphreys, in Wellington yesterday. He said the decision only ! pertained to Australia “We i have not even discussed it.” The withdrawal Would be- ■ come effective in 180 days. ! Cardholders and merchants ' would be . informed of

changes as soon as possible. In the meantime, all transactions made before termination would be honoured. - Bankcard began participation in the two systems early in 1980 to provide an international charge card service for Australian bank customers travelling abroad and to allow overseas travellers Australian credit. However, a recent reorganisation by Visa International had placed Australia in an Asia-Pacific group under the control of a regional board in Singapore with considerble powers. “There are no commensurate benefits to the Australian banks or their customers in the way matters have been shaping,” Mr Martin said. The Visa and Mastercharge systems have agreements with the banking systems in most Western countries, including New Zealand. If they are to function independently in Australia, they will have to build their own merchant base instead of using that already established by Bankcard.

Participants - in the Bankcard system include the ANZ group, the-Wales Bank, the CBA, and the National Bank. ■