Sydney, September 1 — The Reserve Bank of Australia has announced significant changes to the way businesses handle card payments, resulting in clearer upfront pricing for consumers. As of October 1, 2026, businesses in Australia will no longer be able to add a surcharge on card payments, a move that is expected to have little or no direct impact on most Australian businesses. But for the approximately 16% of businesses that currently collect card surcharges, it may require reviewing how they manage the costs of accepting payments.
The mechanics here are straightforward: by removing the surcharge, businesses will need to factor the cost of card payments into their overall pricing structure. This change aims to make payment costs easier to understand, and monthly merchant statements will be updated to reflect the new rules.
The Reserve Bank of Australia has also lowered the maximum ‘interchange’ fees that card schemes can set for card payment services. From April 1, 2027, a cap on foreign-issued card interchange fees will be introduced. To support merchants, CommBank is reducing its Merchant Service Fee from 1.1% to 0.99% per transaction for in-store transactions for customers on simple rate flat pricing, effective October 1, 2026.
This change is expected to put approximately AU$1,000 (about US$660) back in the pocket of a small business with an annual turnover of AU$900,000 (about US$594,000). A sharp reduction in fees can have a significant impact on a business’s bottom line.
The catch is that businesses will need to carefully review their pricing structures to ensure they are not passing on unnecessary costs to consumers. On closer reading, it becomes clear that the changes are designed to promote transparency and fairness in the payment system. American Express, JCB, and UnionPay have aligned with these reforms and will remove surcharging from the same date.
This alignment is a significant development, as it ensures that the changes will be implemented consistently across the industry. The fact that major card schemes are on board with the reforms suggests that the industry is committed to making payment costs easier to understand. Follow the money, and it becomes clear that the changes are designed to benefit consumers and small businesses.
By reducing the costs associated with card payments, businesses can invest more in their operations and pass on savings to consumers. The mechanics of the payment system are complex, but the underlying principle is simple: to promote fairness and transparency in the way businesses handle card payments.
The changes to the payment system have significant implications for businesses and consumers alike. As the industry adjusts to the new rules, it will be important to monitor how businesses respond and whether the changes have the desired effect. The US administration, led by President Donald Trump, Vice President JD Vance, and Secretary of State Marco Rubio, will likely be watching the developments in the Australian payment system with interest, as the issue of payment fees and surcharges is a global concern.
Looking ahead, it will be important to watch how the changes are implemented and whether they achieve their intended goal of promoting transparency and fairness in the payment system. The Reserve Bank of Australia will likely be closely monitoring the situation, and any further developments will be closely watched by businesses and consumers alike.
