From 1 October 2026, businesses will no longer be able to apply a surcharge to debit, prepaid and credit card payments on designated eftpos, Mastercard and Visa networks.

This is a significant shift, not only for consumers, but also business owners, who only have a few more months to prepare for this change.

Surcharging explained

Surcharging is a common sight when shopping – essentially, it’s an additional cost that’s added at the checkout to cover a business’s cost of accepting card payments.

As a basic example, say you order a $5 cup of coffee and pay by card. While the advertised price of the coffee is $5, if this business applies a surcharge to that price, you’ll end up paying more at the register, in this example $5.10.

Applying a surcharge is optional, but around 16% of Australian businesses currently collect card surcharges. What’s more, the RBA estimates that Australians pay around $1.6 billion of card surcharges every year, which is no small change.

What’s changing?

The changes coming into effect from 1 October 2026 apply to card surcharges on card payments made on the eftpos, Mastercard and Visa networks, as well as the American Express network.

Such changes are necessary because, according to the Reserve Bank of Australia’s research, surcharging no longer works as intended. Both consumers and businesses have reported that they find surcharging rules complex and confusing, with surcharges often not well disclosed.

In addition to the changes around surcharging, the RBA has announced that other steps will be taken to make card payments simpler for both consumers and businesses, including:

• lowering the maximum interchange fee that businesses can be required to pay for consumer credit card and debit card payments from 1 October 2026,
• introducing a cap on interchange fees for foreign card payments from 1 April 2027, and
• increasing transparency of card payment fees, by requiring large acquirers as well as eftpos, Mastercard and Visa to publish the fees they charge. This should help businesses check how their fees compare.

Does this mean that all card payment fees will go away?

In short, no. Firstly, these changes do not apply to other electronic payment methods, such as buy now pay later schemes, PayPal, as well as taxi fares.

Secondly, the actual cost to a merchant of accepting a payment by card doesn’t go away. Rather, surcharging will no longer be permitted as a way to recoup such costs. This means that a business will need to either factor card acceptance costs into their base pricing going forward or absorb such costs themselves.

Prepare early

There are a few things that businesses can do to get ready ahead of 1 October. They include:

• Reviewing your most recent merchant statement, so that you know your current cost to accept a payment,
• Confirming whether your business currently applies surcharges, and if so, how to update point-of-sale systems,
• Considering shopping around for lower-cost card payment systems,
• Revising any product pricing or advertising as appropriate, and
• Training staff so they’re aware of the upcoming changes.

If you’re unsure whether your business currently applies surcharges, or would like to understand more about how to navigate these changes, book some time to speak to a member of our team today.