Card Surcharges Are Ending: What Your Business Needs to Know Before 1 October 2026
If your business currently charges customers a surcharge for paying by card, you'll need to review your payment processes before 1 October 2026, when the card surcharge ban in Australia takes effect.
The Reserve Bank of Australia (RBA) has confirmed that businesses will no longer be able to apply surcharges to most debit and credit card payments, including EFTPOS, Visa and Mastercard transactions. American Express has agreed to follow the surcharge ban, while Diners Club currently remains exempt from the changes.
The changes are part of the RBA's Review of Merchant Card Payment Costs and Surcharging and are aimed at reducing payment costs and improving transparency for businesses and consumers.
What's Changing?
Alongside card surcharge ban, the RBA is also introducing reforms designed to reduce the cost of accepting card payments.
Lower card payment costs
The RBA will reduce the maximum interchange fees that apply to debit and consumer credit card transactions.
What is interchange?
Interchange fees are one of the costs built into merchant facilities when businesses accept card payments. By reducing these fees, the RBA expects many businesses will see lower card processing costs over time.
More transparency from payment providers
Card schemes and large payment providers will be required to publish their fees and provide more standardised statement information.
The aim is to make it easier for businesses to compare providers and understand what they're paying for card acceptance.
Who Is Affected?
Any business that currently applies a card surcharge to customers will be affected by the card surcharge ban in Australia, regardless of the accounting software, payment platform or point-of-sale system they use.
Businesses using Xero or MYOB should also be aware that surcharge functionality is expected to be removed or automatically disabled from 1 October 2026 to comply with the new rules.
What Should You Do Now?
While the changes don't take effect until October 2026, now is a good time to review how your business manages card payment costs.
Consider:
- How much surcharge income you currently receive.
- How much you're paying in merchant fees.
- Whether your payment provider is expected to reduce fees before the changes take effect.
- Whether your current pricing structure remains profitable without surcharges.
- Any updates required to your POS or payment systems.
How Are Businesses Responding?
There's no one-size-fits-all approach. Most businesses are considering one or more of the following:
Absorb the cost as an operating expense
Many businesses may choose to treat card processing fees as a normal cost of doing business.
It's also worth considering that customers who previously avoided card payments because of surcharges may be more likely to pay by card in future, increasing the total merchant fees borne by the business.
Review pricing
Some businesses may choose to adjust pricing across products or services to recover the cost indirectly rather than charging a separate surcharge.
Review payment providers
The increased transparency requirements may create opportunities to compare providers and negotiate better rates.
Why This Matters
For some businesses, the impact will be minimal. For others, particularly those processing a high volume of card payments, the change could affect margins and pricing decisions.
Understanding the numbers now will help you make informed decisions before the new rules take effect.
FAQs
When does the surcharge ban start?
1 October 2026.
Can businesses still charge card surcharges?
No, not on most EFTPOS, Visa, Mastercard and American Express transactions.
Will Xero and MYOB remove surcharge functionality?
Businesses should expect surcharge functionality to be removed or disabled to comply with the new rules.
How Key Admin Can Help
If you'd like help reviewing your payment costs, pricing structure or the potential impact on your business, speak with the team at Key Admin. We're happy to help you understand the numbers and work through the options that best suit your circumstances.
This article contains general information only and does not constitute financial, legal or tax advice. You should seek advice specific to your circumstances before making any business decisions.