Tap out: Australia calls time on card surcharges

Australians will today kiss most card surcharges goodbye, following changes announced by the Reserve Bank of Australia (RBA) to remove its prohibition on “no-surcharge” rules. This change will be effective from 1 October 2026.

How do the current rules work?

Australia's card surcharging rules sit within a regulatory framework established under the Payment Systems (Regulation) Act 1998 (Cth) (the Act). Section 18 of the Act empowers the RBA to determine standards for participants in designated payment systems if it considers doing so to be in the public interest.

Until today, under Standard No. 3 of 2016, designated card networks such as eftpos, Mastercard and Visa, were prohibited from preventing or deterring merchants from imposing card surcharges up to the permitted amount. In practice, this allowed businesses to pass their card acceptance costs directly to customers through a separate surcharge at the point of payment.

What changes from 1 October?

From 1 October 2026, the RBA will remove the existing prohibition on “no-surcharge” rules. The change is slightly more nuanced than a simple ban on card surcharges. Rather, the major card networks will be able to include no-surcharge clauses in their contracts governing merchants’ acceptance of card payments.

For most businesses, the practical result is straightforward: they will no longer be able to add a separate fee because a customer pays by card. That restriction will operate through card network rules and merchant contracts, with payment providers and acquirers responsible for implementation.

Why the change?

The RBA explains that removing surcharging is “in line with consumer preferences for sticker prices to be all-inclusive”. The policy aim is to make prices clearer and stop the final cost of a transaction being obscured by a fee added at the checkout.

Most consumers will recognise this frustrating experience. You tap your card for an advertised amount, then check your phone or banking app and find that the transaction was a dollar or two higher because a surcharge was added during payment – something that is especially annoying where the merchant only accepts payment via card. From 1 October 2026, the price presented to the customer should generally be the amount charged to the card.

The surcharging change forms part of a wider package of RBA reforms aimed at lowering merchants’ card payment costs, including reduced interchange fee caps and greater transparency around merchant fees. The RBA hopes these measures will make payment costs easier for businesses to understand, compare and manage.

Who’s removing surcharges?

eftpos, Mastercard and Visa have each decided to introduce no-surcharge rules from 1 October 2026. Notably, American Express and UnionPay have also decided to remove surcharging from that date, despite not currently being subject to formal RBA regulation. PayPal will follow from 5 October 2026.

What does this mean for businesses?

While the surcharge may disappear, the cost of accepting cards will not. Businesses that currently surcharge will instead need to absorb those costs or recover them elsewhere, likely through an uplift to general prices.

The broader reforms may soften that impact. Lower interchange fee caps are intended to reduce merchants’ payment costs, while greater fee transparency should help businesses compare providers and shop around for a better deal.

What does this mean for consumers?

For consumers, the key benefit is greater price certainty.

The downside is that consumers will likely pay slightly higher prices across the board, including when they use a cheaper payment method. The benefit is that the advertised price should more accurately reflect the amount ultimately payable.

For anyone tired of checkout surprises, that greater certainty will be a welcome change.

Written by Steven Pettigrove, Luke Higgins and Natasha Hayne