Australia’s long-running practice of adding card payment surcharges at the checkout is set to end, with the Reserve Bank of Australia (RBA) confirming that businesses will no longer be allowed to impose surcharges on most debit, prepaid and credit card transactions from October 1, 2026. The reform is designed to make pricing more transparent by ensuring the amount displayed is the amount customers pay, whether they use eftpos, Visa or Mastercard.
The change follows an extensive review of Australia’s payments system and affects millions of everyday purchases, including groceries, takeaway meals, retail shopping, fuel and online orders. While shoppers will no longer face unexpected card fees at the register, businesses will still incur payment processing costs, meaning some may adjust their pricing over time.
What the new rules mean for consumers
Under the new framework, businesses will be prohibited from applying separate surcharges to eligible card payments. This ends a practice that has become common across Australia, where customers often discover an additional fee only after choosing to pay by card.
The RBA estimates consumers will collectively avoid around $1.6 billion in surcharge costs each year. Because electronic payments now account for roughly three-quarters of retail transactions nationwide, the reform is expected to affect almost every Australian household.
For shoppers, the immediate benefit is greater certainty. Whether paying in a café, supermarket or online store, the advertised price should match the final amount charged, removing the need to calculate extra percentages before completing a purchase.
The surcharge reforms come as Australians are already adjusting to several major financial changes this year, including the July 1 tax cuts, Centrelink, superannuation and minimum wage updates that affect millions of households.
Why the Reserve Bank decided to intervene
The Reserve Bank said card surcharges no longer serve the purpose they were originally intended to achieve. Instead of encouraging efficient payment choices, they have become inconsistent, difficult to compare and, in many cases, unavoidable for consumers who increasingly rely on digital payments.
RBA Governor Michele Bullock said the reforms are aimed at creating a simpler and more transparent payments system for both consumers and businesses. Alongside banning surcharges, the central bank is introducing changes that reduce the fees merchants pay when accepting card payments.
One of the biggest adjustments involves interchange fees—the charges banks receive for processing card transactions. The cap on domestic consumer credit card interchange fees, for example, will fall from 0.8% to 0.3%, lowering acceptance costs for many businesses.
The RBA believes the combination of lower interchange fees, stronger disclosure requirements and the surcharge ban will improve competition among payment providers while making costs easier for businesses to understand.
Further details about the reforms are available from the Reserve Bank of Australia.
Businesses will still face payment costs
Although card surcharges are disappearing, the cost of processing electronic payments is not. Banks and payment providers will continue charging merchants for accepting card transactions, even if those costs can no longer be passed on as a separate fee at checkout.
For many larger retailers, the lower interchange caps may offset much of that expense. Smaller businesses, however, often operate with tighter margins and may still find payment processing costs significant despite the reforms.
Businesses are also preparing for other payment-related obligations, such as Australia’s new Payday Super rules, which require employers to pay super contributions much closer to each payday.
As a result, some economists expect businesses to gradually incorporate these expenses into their standard pricing instead of charging customers separately.
That means a visible surcharge could disappear while the listed price of some goods and services increases modestly. Any pricing changes are likely to vary by industry, competition and individual business costs rather than occurring uniformly across the economy.
How businesses are expected to benefit
The RBA estimates businesses will save approximately $200 million each year through the removal of surcharge-related costs. A further $910 million in annual savings is expected from lower interchange fees and other payment system reforms.
Another significant change is improved fee transparency. Payment providers, including eftpos, Visa and Mastercard, will be required to publish clearer information about their pricing, making it easier for merchants to compare providers and negotiate better deals.
Smaller businesses, which have traditionally had less bargaining power than major retail chains, are expected to benefit most from these transparency measures.
Industry response remains mixed
Consumer groups have broadly welcomed the reforms, arguing that eliminating unexpected checkout fees will make pricing easier to understand and improve confidence in electronic payments.
However, some banking and payments industry organisations have expressed concerns that reducing interchange revenue could affect future investment in payment infrastructure and competition within Australia’s payments sector.
Others have noted that if businesses respond by increasing their base prices, the overall cost of goods could be shared across all customers, including those who continue paying with cash.
The Australian Competition and Consumer Commission (ACCC) will continue overseeing compliance with Australia’s consumer protection and pricing laws. Additional guidance is available through the Australian Competition and Consumer Commission.
The new rules will take effect on October 1, 2026, giving businesses time to update pricing systems, payment terminals and customer information before the changes become mandatory.
For consumers, the reform should deliver a simpler checkout experience with fewer unexpected costs at the point of payment. Whether it ultimately lowers the overall cost of living will depend on how individual businesses respond to the ongoing expense of accepting card payments.
Australia’s overhaul represents one of the country’s most significant payment system reforms in years, reflecting the growing dominance of electronic payments and the push for clearer, more transparent pricing across the economy.
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