The Reserve Bank of Australia (RBA) is Australia's central bank and has the responsibility of controlling Australia's money and banking system, as outlined in the Reserve Bank Act 1959. It has three main objectives, which include the stability of the Australian currency, the maintenance of full employment and the economic prosperity and welfare of the people of Australia.
The conduct of monetary policy is the most important ongoing responsibility of the Reserve Bank. It is action taken by the RBA in order to influence the cost and availability of money in the Australian economy through influencing the general level of interest rates. The RBA meets every month to decide whether interest rates should be changed. Lenders then use these decisions as a basis for setting the interest rates for their individual loan products and will usually alter interest rates a day or two after any RBA announcement.
The Reserve Bank is the sole issuing authority for Australian currency and is responsible for the payments system.
This means ensuring the efficiency and stability of payment methods such as credit cards, electronic cash, traveller's cheques and stored-value cards. Other banks also hold exchange settlement accounts with the RBA, and these are used to allow banks to settle debts between themselves as well as with the RBA at the end of each days trading.
In 2002, the Financial Services Consumer Policy Centre at the University of New South Wales Faculty of Law welcomed the release of the Reserve Bank's credit card reforms, which became an effective way of ensuring the efficiency and stability of payment methods. The centre's director, Mr. Connolly, stated that consumers had been paying higher prices for goods and services because of the hidden interchange fees built into the credit card system, and these new reforms will replace an...