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Australia Ends Card Surcharges: Big Savings Ahead
31 Mar
Summary
- Consumers will save A$1.6 billion annually with the end of card surcharges.
- Businesses will benefit from A$900 million in annual cost reductions.
- New regulations will take effect on October 1, impacting eftpos, Visa, and Mastercard.
The Reserve Bank of Australia (RBA) will eliminate surcharges on debit and credit card payments for consumers starting October 1. This decision follows a year-long review of the payment system, concluding that the surcharging regime, in place for over two decades, is no longer effective. Businesses are projected to save around A$900 million annually as interchange fees are lowered in stages.
Consumers are anticipated to save A$1.6 billion each year as a result of the ban on surcharges. The RBA noted that many businesses were applying the same surcharge rate across all card types, diminishing the original intent of the policy. Consumer sentiment also leaned towards ending surcharges, with a significant majority viewing them as unnecessary.
American Express is not subject to these specific rule changes due to a separate agreement with the RBA. The central bank also plans to initiate public consultations by mid-2026 to explore potential regulations for other aspects of the retail payment system, such as mobile wallets and buy now, pay later services.
