AP+ CEO Lynn Kraus
Australia’s largest native payments provider – Australian Payments Plus – generated a big surge in top-line revenue last year, but a costs blowout plunged the group to a negative bottom line result.
AP Plus posted a net loss of A$5.5 million in the 12 months to the end of June.
AP Plus is the holding company for Australia’s three domestic payments systems – NPP Australia, Eftpos and BPay.
The merger of the three businesses was approved by the ACCC last year and took legal effect in February.
AP Plus directors provided few insights into the discrete performances of each of the subsidiaries, electing to present most of the revenue and expense disclosures on a consolidated basis.
A controversial feature of the accounts was the lack of commentary from directors regarding the measures they had taken to comply with court-enforceable undertakings given to the ACCC for the provisioning of least cost routing through the Eftpos business.
Under the terms of the merger’s approval, the AP Plus board and Eftpos management are required to ensure Australian merchants are given access to least cost routing services.
Least cost routing allows retailers to direct debit card payments to the cheapest processing platform.
Eftpos is widely acknowledged as the cheapest debit processing service in Australia but has struggled to win support from the major banks for its price offers.
The slow rollout of least cost routing services to retailers has been attributed in part to the fact that banks collect bigger fees when transactions are processed by more expensive debit card processers such as Visa and Mastercard.
The marketing profile of the Eftpos business has been subdued since the business was joined to AP Plus in February.
There have been no press releases promoting Eftpos’ services since May and almost no promotion of least cost routing from AP Plus.
According to the AP Plus website, Eftpos last issued a press release on 18 May.
AP Plus is required to promote least cost routing services through Eftpos for the next three years.
An independent auditor has been appointed to provide ongoing reports to the ACCC on AP Plus’ compliance with the enforceable undertaking.
- This article amended Thursday, 3rd November, to remove comparisons with prior years.