Credit card schemes will be able to reclaim their power to sanction banks that tolerate excessive surcharging of purchases made with payment cards once the forthcoming changes to the regulation of card schemes come into force from the beginning of next year.The Reserve Bank of Australia said yesterday that it will once more allow credit card schemes to adopt rules that limit the surcharge a merchant may charge when someone pays with a credit or debit card. The decision reverses one facet of the RBA's intervention in the cards payments market 10 years ago.After a year of consultation on the topic, and nine years of controversy over the practice of surcharging, the RBA said it had formed the view that there was "sufficient evidence to suggest that such practices are now relatively widespread" and that surcharging practices were "no longer entirely in line with the original intent of the reforms".The new regulations will allow card schemes, MasterCard and Visa to write rules (that, in turn, will apply to the banks) that limit the level of surcharges to what the RBA defines as "reasonable costs of acceptance". Broadly, these terms include the merchant fee charged by the bank plus other payment processing costs. The RBA expects American Express and Diners Club to adopt the same approach.For the change in policy to have any affect in the marketplace it will be up to the banks to patrol - that is, to prevent - surcharging.The card schemes, in turn, will have to police the actions - or lack of action - by their banks.The new regulations will come into force from the beginning of 2013, though the date of effect of any limits in scheme rules is still to be confirmed.For banks, the chief issue is the extent to which they are willing to upset long established relationships and apply a range of measures open to enforce conformance with new scheme rules. Beyond dropping the merchant as a customer banks may not have many options.For card schemes, the chief issue is the extent of their willingness to back up their rhetoric and to fine banks that fail to curb excessive charging by merchants.The RBA cited research, some of it gathered recently for the purpose of its review, that put the average level of credit card surcharges at one percentage point above the level of the merchant fee charged by the banks.The best known and most dubious surcharges are those of airlines (which are frequently more than five per cent) and taxis (10 per cent).The latter industry may provide the most significant test case of the new rules.If scheme rules are to have any punch National Australia Bank will have to curtail the surcharges of its client, Cabcharge (the dominant force in taxi payments), and the card schemes will have to fine NAB if it fails to do so.Alternatively, the new rules may give impetus to alternative payment options, with PayPal Here one of many challengers likely to exploit the opening created by the