Ban on debit and credit card surcharges | The Business | ABC NEWS
The Reserve Bank of Australia has introduced reforms that will remove surcharges on debit, prepaid and credit cards on card networks including eftpos, Mastercard and Visa. The ban is expected to save consumers about $1.6 billion in surcharge fees each year, with businesses saving $200 million in surcharge fees annually. The package of reforms also includes lowering the caps on interchange fees paid by Australian businesses, with a focus on small businesses, which currently pay the highest fees. Caps on interchange fees for foreign card payments will also be introduced. The RBA expects these reforms to save businesses $910 million each year. But the changes could cost the banks around $660 million a year and put reward points in the firing line. Simon Birmingham from the Australian Banking Association says the Reserve Bank even thinks “banks could look at higher fees or charges on credit cards, interest rates and other changes to those credit cards.” “In the UK, we saw things like annual fees and interest rates go up. Access to credit, we think, could be an issue as a result on this, as banks need to think about the profitability of their credit card businesses, ” said Visa Oceania group country manager Alan Machet. Visa and Mastercard both welcome the surcharge ban. Mr Machet said the Reserve bank has more work to do and warned payments could move to other unregulated networks, pushing the overall costs in the system up.
A key part of this change is to give consumers a fairer go at the shops. But even the RBA expects the 16 per cent of businesses that surcharge may now increase their prices to cover transaction costs, pushing inflation even higher. Andrew McKellar from the Australian Chamber of Commerce and Industry said “these costs are still going to be worn somewhere in the system … so small businesses are either going to absorb that cost or they’re going to have to pass it on their customers.”
The final part of the reforms is to increase transparency and competition over fees, with eftpos, Mastercard, Visa and the big acquirers like NAB, Commonwealth Bank, Westpac and ANZ to publish the fees they charge to businesses. Most of the reforms are due to take effect from October 2026.
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Read more here: https://www.abc.net.au/news/2026-03-31/rba-surcharges-debit-credit-new-reforms-october-2026/106500064
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