In a landmark decision that will reshape Australia’s payment landscape, the Reserve Bank of Australia (RBA) has announced the elimination of controversial card surcharges that have cost consumers approximately $1.6 billion annually. The comprehensive reforms, set for full implementation by October 2026, represent the most significant overhaul of payment regulations in over two decades.
The central bank’s review concluded that the existing surcharge framework, established more than twenty years ago, has failed to guide consumers toward more efficient payment methods as originally intended. Under the new regulations, businesses will be prohibited from adding separate fees for debit, prepaid, and credit card transactions across eftpos, MasterCard, and Visa networks. Instead, merchants must incorporate all payment processing costs directly into their advertised prices.
RBA Governor Michele Bullock emphasized that these changes will eliminate checkout surprises for consumers. ‘When card surcharges end, the sticker price will be the price that consumers end up paying,’ Bullock stated. ‘Consumers will no longer be surprised at the checkout by an unexpected surcharge for paying by card.’
Concurrently, the RBA is implementing substantial reductions in interchange fees—the charges businesses pay to card providers. The cap on domestic consumer credit card transactions will be slashed from 0.8% to 0.3%, projected to save businesses approximately $910 million annually. The central bank has committed to monitoring payment providers to ensure these savings are passed through to consumers rather than being retained by financial intermediaries.
Additional transparency measures will require payment networks including eftpos, MasterCard, and Visa to publicly disclose their fee structures, enabling merchants to compare costs more effectively. The reforms will be implemented in phases, with domestic changes effective October 2026 and new regulations for foreign-issued cards commencing April 2027.
While acknowledging that businesses may adjust overall pricing to recover lost revenue, the RBA noted that approximately 84% of Australian merchants don’t currently impose surcharges. The changes are particularly expected to benefit small businesses, which typically face higher payment processing costs.