Musgrave's wants Government to push public to cards over cash
Musgrave's has called on the Government to push card payments in shops instead of cash in a bid to reduce costs for retailers.
The SuperValu owner, which is one of the largest companies in the country and employs around 30,000 people, urged the coalition to conduct a national campaign "promoting the use of cards and outlining the benefits to both SMEs and consumers".
The call was made in a recently published submission to a Department of Finance consultation on interchange fees.
In March the European Parliament announced that it had adopted proposed regulations on interchange fees.
Interchange fees are charged by a card holder's bank to a retailer for accepting debit and credit cards.
The new rules capped the fees at 0.2pc of the value of the transaction for debit cards and 0.3pc for credit cards.
This limit was also introduced in Ireland by the Department of Finance in December, which halved the rate of the fees here. Before it introduced the new lower cap, the department launched a consultation asking on how best to implement the new European regulations.
In a recently published submission to the consultation, Musgrave's said that the cost of cash handling "has increased in recent months for retailers".
The company said reducing fees on debit card payment "will increase retailers' willingness to encourage card transactions".
"A growth in card transactions over time will reduce our economy's reliance on cash, leading to significant savings for businesses and the State.
"From a consumer perspective card transactions are also cheaper than withdrawing cash," Musgrave's said.
Musgrave's added that it believes that the State "will need to play a significant role in persuading consumers of the benefits of using cards rather than cash".
It said: "We also strongly recommend that the Government/Department of Finance/Central Bank conduct a national campaign promoting the use of cards and outlining the benefits to both SMEs and consumers."
A spokesman for the Musgrave Group told the Irish Independent that a "substantial behaviour change would be required to encourage the general public to increase the number of card payments made."
He said in order to achieve this a number of actions would be required, including an educational campaign run by the State.
He added: "Consumers will always favour a mix of cash and electronic payment options. We will continue to offer our customers a range of methods to paying order to ensure that their needs are met."
A spokesman for the Department of Finance said that it is encouraging increased card usage as part of the 'National Payments Plan'.
The Plan, launched by the Central Bank, aims to increase the use of electronic forms of payment such as debit cards and electronic banking. The finance spokesman said: "The Department of Finance, in conjunction with the Central Bank, has been looking to promote the use of electronic payments through the National Payments Plan. Promoting the use of cards and reducing the amount of cash being used is a core part of the plan." The reduction in interchange fees was one of a number of moves recently introduced by the Government in a bid to increase card payments. Ireland is among the biggest users of cash and cheques in Europe and the public has shown a reluctance to move over to electronic payments.
In a bid to counteract this, as well as the reduction in interchange fees, the Government introduced a 12c charge on all ATM transactions, capped at €2.50 or €5 - depending on the kind of card the consumer is using. The maximum transaction which can be made through contactless payments was increased in Budget 2016 from €15 to €30 while the €5 stamp duty which was levied on all debit and ATM cards was abolished.