card surcharges have ended: what it means for your business

updated 8 October 2026

When a customer taps their card, somebody still has to pay for it. Previously, many businesses passed that cost on through a card surcharge. Since 1 October 2026, that option is no longer available for debit, prepaid and credit card payments.

The processing cost, however, has not disappeared.

So, where does this cost sit in your business? 

If you previously passed card processing costs on to customers, this is more than a change at the checkout. It could affect your pricing, margins, payment systems and the way you manage those costs across the business. 

The changes are now in place. Here is what your business should check.

 

what has changed? 

 

Following the Reserve Bank of Australia’s [RBA] review of merchant card payment costs and surcharging, card networks introduced ‘no surcharge’ rules from 1 October 2026. 

This means businesses can no longer charge customers an additional fee because they choose to pay using a debit, prepaid or credit card through EFTPOS, Visa, Mastercard or American Express. 

Simple enough for customers. For businesses that previously surcharged, it creates a few decisions. 

The change does not apply to other types of charges, such as weekend or public holiday surcharges in hospitality, or genuine booking or service fees that apply regardless of the payment method used. 

 

why has it changed? 

 

Card surcharges were originally intended to encourage customers to choose lower-cost payment methods. But as cash use has fallen and card payments have become the norm, avoiding a surcharge has become harder. 

The RBA found that the previous system had become complex for businesses, confusing for customers and difficult to enforce. In many cases, customers were not seeing the true cost of a purchase until they reached the payment screen. 

Removing card surcharges is intended to make pricing simpler and more transparent. 

But the cost of accepting card payments still has to sit somewhere. 

 

what does this mean for your business? 

 

If your business did not previously surcharge, there may be very little you need to change. It is still worth reviewing your merchant fees to make sure you are getting a competitive deal. 

If you previously passed those costs on to customers, the impact could be more significant. 

Check that surcharges have been removed from your payment systems, then answer one important question:

Do you absorb the cost or build it into your pricing? 

Before you decide, run the numbers. 

A processing fee of 1 or 2 per cent might look small on an individual transaction, but across a year it can add up to a meaningful cost. Funny how the small percentages have a habit of doing that. 

Before changing your prices, understand: 

• how much your business currently pays in merchant and processing fees 
• how much surcharge income you currently recover from customers 
• which products, services or locations are most affected 
• whether your current margins can absorb the difference 
• how your prices compare with the market. 

The right answer will depend on your transaction volumes, average sale value, margins and how your customers prefer to pay. 

 

will your payment costs come down? 

 

Maybe. But do not bank on it. 

The surcharge changes took effect alongside reductions to the maximum interchange fees on domestic debit and consumer credit card transactions on 1 October 2026. These changes are intended to reduce payment costs, particularly for small businesses. 

Interchange is only one component of the total fee you pay to accept cards. So, do not assume your overall merchant costs will fall by the same amount, or that your provider will automatically put you on the best available deal. 

Use this change as a reason to review your statements, ask your provider whether the lower interchange fees have been reflected in your rates and compare alternatives. More standardised fee information is also being introduced to make it easier for businesses to understand their costs and shop around. 

 

what should you do now? 

 

Start with these five steps: 

1. Measure the impact
   Review card processing fees and surcharge income for the last 12 months before the change. Work out the annual gap your business now needs to absorb or recover through pricing. 
2. Speak with your payment provider
   Confirm which transactions are affected, check that surcharge settings have been updated and ask whether your merchant fees have been reduced. 
3. Review your pricing
   Model the effect on your margins before increasing prices. A blanket percentage increase may be simple, but it may not be the right answer across every product or service. 
4. Check your systems + communications
   Check that card surcharges have been removed from terminals, invoices, online checkouts and accounting workflows. Make sure signage, websites, booking terms and customer communications reflect the changes and display prices clearly.
5. Check the result
   Monitor merchant fees, gross margin and customer behaviour now that the changes are in place. Your first decision does not need to be your last one. 

 

can you just rename the fee? 

 

No. 

Calling a card surcharge a ‘service fee’ does not necessarily make it one. 

If a fee is only charged when a customer uses a particular payment method, it may still be treated as a payment surcharge. Any separate booking or service fee should reflect what it actually is, apply consistently and be disclosed clearly in line with Australian Consumer Law. 

 

now, decide where the cost sits 

 

The end of card surcharges is welcome news for many customers. But for businesses, the cost of accepting payments simply needs to be managed somewhere else. 

So, how much are card payments really costing your business? Can your current margins absorb that cost? And when did you last compare payment providers? 

A quick review now can help you make a considered pricing decision, check your systems and communicate clearly with customers.

Know what card payments cost you. Decide where that cost will sit. Make sure your systems reflect the changes. Then keep an eye on your margins. 

Because removing the surcharge does not remove the cost. 

 

we’re here to help 

If you have any questions or need a hand understanding what these changes mean for your pricing, margins or cash flow, you can contact me or give the team a buzz on 1300 BDEPOT. 

 

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