Fed: Visa/M-C attack credit card changes

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Fed: Visa/M-C attack credit card changes

Visa and MasterCard have warned Australian consumers will be worse off under a majorrevamp of the nation's credit card system.

The Reserve Bank of Australia has backed a new system to start next year, which itsays will save consumers around $500 million a year.

Companies like Telstra and Woolworths will be able to compete against the banks withtheir own credit cards, while retailers will be able to charge customers who use extracredit.

But MasterCard general manager LEIGH CLAPHAM's warned the proposals will destroy Australia'scredit card system.

Visa executive vice-president GORDON WHEATON's joined his credit card competitor inderiding the changes as bad for consumers.

Labor's demanding the government allow the Australian Competition and Consumer Commissionto ensure savings from the changes flow to retailers and consumers.

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KEYWORD: CARDS (CANBERRA)