From October 1, 2026, a cafe in Australia cannot add a line to the bill for the cost of swiping a card. The ban covers Visa, Mastercard and eftpos, and it comes from the Reserve Bank of Australia (RBA). American Express has agreed voluntarily to drop its surcharging options.
The RBA concluded that surcharges no longer do their job. They were meant to steer people toward cheaper ways to pay. But cards are now so common that avoiding a business that surcharges is hard, and the rules are confusing for shoppers.
Who is affected
Not many businesses, as it turns out. The RBA found only 16% pass on surcharges, so little changes for the rest. Small retailers and hospitality venues are the more likely surcharge users, and they will now carry the full cost of accepting cards. RBA data puts that cost at 0.85% to 2% of the transaction value for debit and eftpos, and 1% to 2% for credit.
Businesses can still recover the money. A cafe, for example, could raise food and coffee prices across the board. Discounts for paying cash are allowed too, as long as the income is reported for tax. Weekend and public holiday surcharges, booking fees unrelated to payment costs, and card payment minimums all remain legal.
The offset
The RBA is also lowering the cap on interchange fees, the amounts paid to banks when a card payment goes through. The idea is to ease some of the burden on merchants and push banks and payment providers to compete on price. Visa, Mastercard, eftpos and others will have to publish their fees clearly.
Commonwealth Bank said on Monday it will cut its merchant service fee from 1.1% to 0.99% per transaction. That applies to flat-rate pricing for in-store transactions only, and starts October 1. Payment provider Tyro is offering introductory rates to new merchants. Other banks are preparing to give merchants more detail on their fees.
Shoppers get one clear benefit. The price on the shelf will match what they pay at the checkout with a Visa, Mastercard or eftpos card.
There is a catch for credit card holders. With less interchange revenue, card-issuing banks could raise interest rates. Banks also use that revenue to fund rewards, so perks such as frequent flyer points and travel credits could shrink.
Renaming a surcharge will not work. The Australian Competition and Consumer Commission and state consumer agencies police misleading pricing, and a business that disguises a card surcharge as a “service fee” could face significant penalties. Customers who see excessive charges can report them to the ACCC. Businesses should also check signage, menus and invoices for old surcharge wording.
