SYDNEY, April 1, 2026, 05:09 AEDT
Starting Oct. 1, Australia will prohibit surcharges on debit and credit card payments handled through eftpos, Visa, and Mastercard, following a Reserve Bank of Australia ruling that labeled the current fee system as too murky and ineffective. According to the RBA, Australians fork out roughly A$1.6 billion in these charges every year; with the new rules, businesses are set to pocket about A$910 million in annual savings from the larger fee shakeup.
Cost-of-living strains are front and center for both households and lawmakers right now, and cards make up roughly 75% of payments in Australia. About 16% of businesses continue to tack on surcharges, prompting the RBA and government to press for prices that include all charges upfront—no last-minute add-ons at checkout.
The change isn’t just about cleaner bookkeeping. According to the central bank, surcharges don’t push shoppers to lower-cost payment options anymore—most merchants set a flat fee for all cards, the rules are confusing, and disclosures are often lacking. In its survey, 76% of consumers wanted the surcharging to end.
The RBA is slashing consumer credit-card interchange fees, dropping the rate from 0.8% to 0.3% per transaction—these are the wholesale fees that show up in merchants’ card processing costs. Debit and prepaid cards get a new cap too: 8 cents or 0.16%. A 1% ceiling will apply to foreign-issued cards, and networks plus big acquirers face new disclosure requirements starting April 1, 2027.
Treasurer Jim Chalmers argued that Australians shouldn’t face penalties just for paying with debit or credit cards, pitching the package as a relief for cost-of-living pressures. According to the RBA, the review kicked off in October 2024, collecting upwards of 260 written submissions and holding about 150 meetings with players from industry, government, and business groups.
Consumer advocates were quick to praise the move. Morgan Campbell from CHOICE described card surcharges as “a product of another time,” and Canstar’s Sally Tindall said Australians were tired of “an extra hit at the till.” CHOICE
Payments players are eyeing fresh opportunities as merchants become more aggressive in searching for better deals. Tyro CEO Nigel Lee described the reforms as “a win for consumers” and for small businesses, adding that simpler pricing could help merchants size up different providers more easily in a market long dominated by bundled or murky fee structures.
Savings won’t hit all at once—or equally. The Australian Banking Association warned banks could make up for lost income by hiking card fees, reducing interest-free days, or downgrading rewards. Chief executive Simon Birmingham was blunt: lower interchange caps, he said, would “not lower costs for business.” Reuters
Hospitality groups have echoed this point, arguing cafes, pubs and restaurants could just bake payment fees into their menu prices. The RBA’s take: for venues already surcharging, customers would end up paying about the same overall—just built into the listed price instead of tacked on at checkout. It doesn’t see much risk of inflation from any rounding up.
Some issues are still unresolved. American Express continues to operate under its own deal for the time being. The RBA flagged a new consultation set for mid-2026, aiming to look at mobile wallets, three-party card networks, buy-now-pay-later services and e-commerce platforms.
