RBA card surcharge and payment fee changes – what they will mean for small business

By Laura Thomas

Card surcharges will be banned and payment fees reduced later this year, as part of changes expected to simplify card payments for businesses and consumers.

The Reserve Bank of Australia (RBA) introduced reforms this week that will put an end to surcharges on debit, prepaid and credit cards on card networks including eftpos, Mastercard and Visa.

Caps on interchange fees paid by Australian businesses when accepting card payments will also be reduced, lowering costs, especially for small businesses.

Set to take effect from 1 October 2026, the changes follow an RBA review of Australia’s merchant card payment costs and surcharging. It found surcharges were no longer serving their intended purpose, transaction fees paid by businesses were too high and the rules around them were complex and confusing.

In a media release, the RBA said the changes are designed to “promote competition and efficiency in the payments system”.

The Federal Government revealed the reforms were expected to save consumers and businesses almost $1.8 billion annually.

In an increasingly digital world, cash use is continuing to dwindle as consumers make more card payments than ever before.

This makes card payment facilities a must-have for small businesses, such as olive producers, keen to maximise their direct-to-public sales. But of course, they come at a cost.

So what will the RBA’s changes mean?

For small business, the change will mean fees charged by a payment service provider for card payments can no longer be directly recouped from the consumer via a surcharge at check-out.

These fees will need to be either be absorbed as a tax-deductible business cost, or incorporated in advertised “sticker” prices.

To help business owners ensure they are getting the best deal, interchange service providers will also be required to provide clear information about the fees they charge.

For consumers, the change will provide more transparent pricing and eliminate last-minute surcharge surprises at the check-out. The price advertised on a product will be the total price payable, whether paying by cash or card.

Find out more

Learn more about the RBA’s Review of Merchant Card Payment Costs and Surcharging, its key findings and what the changes will mean for you.

View current card surcharge information via the Australian Competition and Consumer Commission website, including the different types of card payment fees and their costs for businesses.

Sources:
www.rba.gov.au
www.accc.gov.au
www.alp.org.au

Image: Produce market, Unsplash.