Cabcharge surcharge too much for some

Cash may be making a minor comeback, at least when it comes to paying a taxi fare and the alternative is a ten per loading on the metered fare.

Cabcharge, the dominant supplier of payments services to the taxi industry in Australia, yesterday said turnover on its payment system declined two per cent to $1.05 billion in the year to June 2009.

The extent of the decline in taxi travel, and a function of the weaker economy, is not clear. Cabcharge did report higher turnover from other taxi services (as it is a network owner in most cities as well).

The firm's own payment card (used by corporate accounts, for example) is progressively declining. The average spend on Cabcharge accounts also fell.

Of all fares processed by Cabcharge 45 per cent were on bank-issued cards, four times the level of four years ago.

The choice of payment card makes little difference to Cabcharge: drivers still apply a surcharge of 10 per cent, though Cabcharge reports this service margin as being around nine per cent in its accounts.

Cabcharge next year will have to defend proceedings in the Federal Court bought by the Australian Competition and Consumer Commission.

The ACCC filed the case in late June. The ACCC has alleged that Cabcharge used its market power to refuse to enter into agreements with competing suppliers of payment processing services.

The ACCC has also alleged that Cabcharge used its market power to supply a significant number of taxi meters and fare schedule updates either free of charge or below cost for anti-competitive purposes in relation to taxi meters and processing services.