Reserve Bank boss Michele Bullock has hit back at the banking lobby and a Liberal MP after financial institutions took aim at the RBA's efforts to weed out unfair card payment surcharges.

Speaking before a parliamentary economics committee on Monday, the RBA governor said she was "surprised" by Australian Banking Association chief executive Simon Birmingham warning the plan could undermine fraud prevention.

Mr Birmingham told an AFR Cyber Summit the lost revenue from interchange fees would limit the amount banks could invest in efforts to prevent scams and frauds.

Ms Bullock said she was "somewhat surprised" the former coalition finance minister would draw the correlation.

"It's extremely unlikely that they're going to shoot themselves in the foot by removing fraud protections or anyth

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