Commonwealth Bank boss Matt Comyn pressed on coffee price tag discrepancies between cash and card

The Big Four banks need to explain to Australians why they are being charged more when using their cards than they are paying with cash, a Labor MP has demanded, after a terse clash with the Commonwealth Bank boss.

Chief executive Matt Comyn, appearing before the House of Representatives economics committee on Thursday, was questioned by Bennelong MP Jerome Laxale why Australians buying a cup of coffee were charged $5 if paying cash, and $5.08 if using their card.

Mr Comyn denied it was a “like-for-like comparison”, explaining that costs are “embedded for cash but not embedded for digital” because of the domestic and global mechanism for electronic payments.

Mr Laxale told The Nightly the CBA boss had not explained to his satisfaction why the discrepancy existed.

“I’m no clearer as to why. They even said digital payments cost them less to process than cash,” he said.

“If that’s the case, why are businesses and consumers being charged more for digital payments than they are cash.

“Given what we’ve learned today, that to me is evidence the rort has to end.

“It’s about time the Big Four banks explain why we’re being charged for digital payments when we’re not for non-digital payments.”

Mr Comyn had told the committee the cost of accepting electronic payments had fallen by more than 30 per cent, making Australia one of the lowest, “if not the lowest, cost of acceptance markets in the world”.

“I can assure you, there’s been a lot of downward pressure on lowering the cost of payments. There’s been a lot of investment in making the payments infrastructure much faster, cheaper. In this case for consumers, there are also risks associated with that,” he said.

Mr Comyn later pushed back at suggestions the bank was extracting excessive profits from customers struggling with cost of living through card payments and surcharges.

The bank posted a $9.8b profit in the last financial year, but Mr Comyn refuted suggestions the bank’s merchant acquiring business - where card-based payments from businesses are collected and sent to card issuers - was profitable.

He said the business had in fact “lost money last year, and the year before”, and that the money the bank had receieved from card issuers was often returned to customers, or invested into technology.

Mr Comyn also hit back at suggestions CBA’s relationship with Mastercard was leading to higher costs for customers, slamming the “narrative” that Australians were being exploited.

“I see this now again and again, over and over, businesses in Australia are being represented in this false dichotomy that for a company to earn any sort of income or profit, it is therefore inferred... on a daily basis, as somehow being unjustly extracted from consumers,” he said.

“This sort of fact free rhetoric which is being published more broadly is very damaging. It is eroding trust in institutions, all of our institutions. It is a real cause for concern.”

In his wide-ranging, three hour appearance before MPs, Mr Comyn also pitched the idea of making banks that fail to keep customers safe from scams reimbursing those who fall victim.

He revealed the bank had spent more than $800m on preventing, detecting and disrupting scams in the last financial year, and now employs more than 4000 people to fight scams.

Mr Comyn said the efforts had meant the bank had cut its customers’ scam losses by more than 50 per cent in that time.

Noting scam activity had escalated since COVID-19, Mr Comyn said the bank had been able to do this through “several market-first innovations”, and was now sharing technology and intelligence with other financial institutions to reduce scam losses across the industry.

But he called for a mandatory code to require banks, telcos, social media companies and others to meet minimum standards and share information.

“It is simply not possible for the banks alone to limit scam losses across the community,” he said.

He said there should also be obligations to “act quickly: to lock bank accounts, to block phone numbers and to remove scam ads and accounts on social media”.

And, he said there should be a “proportionate liability scheme”.

“Which says to all of these organisations, including, of course, us that if you do not meet your obligations, then you will be required to reimburse customer losses,” he said.

“This liability scheme should be simple, efficient and fair for customers with a single front door to access and resolve disputes across scams, fraud, cyber security and financial crime prevention.

More broadly, Mr Comyn said the economy was “fundamentally sound” despite the number of customers finding it harder to deal with rising cost of living.

He said households and businesses had experienced “extreme shocks” in recent years following pandemic lockdowns, surging inflation and the series of rapid interest rate rises.

“Savings are being depleted, particularly by working families,” he said.

Households are spending more on essentials and cutting back on discretionary spending, he said, with younger Australians most sensitive to price changes.

“In the past year, we have deliberately and proactively contacted customers, and have initiated 132,000 tailored payment arrangements to those most in need,” he said.

Mr Comyn also slammed the “Robin Hood” tax policy unveiled by Greens leader Adam Bandt on Wednesday, which would impose a 40 per cent tax on “excessive profits” of Australia’s biggest companies - including banks.

He described the idea as “insidious populism” which ignored the “beneficial contributions of businesses”.

“I do believe that there is important tax reform (that needs to happen), but these performative sort of policies that are... designed to attract attention, they lack rigor and merit, and a number of them just rely on assumptions that are just demonstrably false,” he said.

Mr Comyn said the current tax system was not as “efficient and fair” as it could be, and suggested Australia was over relient on income tax and should consider more taxes on wealth.