Reserve Bank of Australia Bans Card Payment Surcharges

The Reserve Bank of Australia will ban surcharges on Visa, Mastercard, and Eftpos payments starting October 1. The reform follows an 18-month review of the payment system and is expected to save Australian consumers approximately $1.6 billion per year.

To support small businesses, the central bank is reducing the maximum interchange fee card issuers can charge small businesses from 0.80% to 0.30%, a measure projected to save those businesses $910 million annually. Despite this, the bank notes that shelf and menu prices may rise by a one-off 0.1% as businesses absorb remaining costs.

Major banks and credit card providers have already begun recouping lost revenue by raising annual fees and interest rates, capping reward points, and removing perks such as travel insurance. The move aligns with a Labor government promise to eradicate debit card surcharges as a cost-of-living measure.