From 1 October 2026, Australian businesses can no longer add a surcharge to customer payments made on EFTPOS, Visa, or Mastercard. The Reserve Bank of Australia announced the change on 31 March 2026 as part of a wider reform package that also caps interchange fees on consumer credit cards at 0.3% and tightens transparency on wholesale payment costs.
The RBA estimates the package will reduce merchant fees by around $910 million a year once fully bedded in. Every business that accepts a card is affected. If you run a cafe on a zero-cost EFTPOS plan, take Visa in your online checkout, or tap a customer's card at a market stall, the rules that have applied for the past decade are changing. The practical steps to take are at the bottom of this article.
What the RBA actually announced on 31 March 2026
On 31 March 2026, the RBA released its final response to the Merchant Card Payment Costs and Surcharging review. Three reforms sit at the centre.
First, surcharging on EFTPOS, Visa, and Mastercard transactions is prohibited from 1 October 2026. The RBA's stated reason is price transparency: when a card surcharge sits at the bottom of a receipt, customers cannot easily compare the headline price of one business against another. Removing the surcharge forces all-in pricing.
Second, the cap on interchange fees for domestic consumer credit cards drops from the current average of around 0.5% to 0.30% on the same date. The wholesale cost of processing a Visa or Mastercard credit transaction therefore falls materially for the first time since 2017.
Third, the RBA will publish merchant-fee data twice a year by provider and by card scheme. The transparency rule is intended to make it harder for acquirers to obscure pricing differences and easier for small businesses to compare offers.
Two things are not banned. Surcharges on American Express, Diners Club, JCB, and other premium scheme cards remain legal, because those schemes sit outside the RBA's designation. Surcharges on Buy Now Pay Later transactions are also untouched, although individual BNPL providers (Afterpay, Zip, Klarna) set their own merchant rules on this.
Source: Reserve Bank of Australia, Merchant Card Payment Costs and Surcharging Review: Final Response, 31 March 2026.
The timeline at a glance
Here is the sequence of dates and what each one means for a merchant.
| Date | What changes | Who it affects |
|---|---|---|
| 31 March 2026 | RBA announces final reforms | Industry and merchants put on notice |
| April to August 2026 | Industry consultation closes on implementation detail | Acquirers and PSPs update plans |
| 1 October 2026 | Surcharge ban and 0.3% interchange cap take effect | Every business accepting cards |
| H1 2027 and ongoing | RBA publishes merchant-fee data twice yearly | Merchants gain visibility on competitive pricing |
The five months between the announcement and the effective date are the window for renegotiating contracts, repricing menus or product lists, and updating point-of-sale systems. Waiting until late September is not a viable plan: acquirer support queues fill quickly in the weeks before any major rule change.
Who is affected by the surcharge ban
Every Australian business that accepts a Visa, Mastercard, or EFTPOS card payment is affected. The size of the impact varies by sector.
Hospitality sits squarely in the firing line. Cafes, restaurants, pubs, and food trucks are the most visible surchargers in Australia, and the surcharge line on a coffee receipt has become a regular consumer grievance. From October, that line cannot appear.
Small retail and trades running zero-cost EFTPOS terminals are the next most exposed. The entire commercial premise of these plans is that the customer pays the fee. When that becomes illegal, the merchant must either absorb the cost or change provider.
Online retailers processing domestic Visa and Mastercard payments lose the option of a checkout surcharge on those schemes. International cards, AMEX, and BNPL remain surchargeable, so the policy hits hardest on businesses with a predominantly Australian customer base.
Businesses with significant AMEX volume, B2B card-not-present payments, or a heavy BNPL mix have different exposures and may want one-on-one guidance. Our services team covers tailored statement reviews and provider negotiation.
The end of "zero-cost EFTPOS"
Zero-cost EFTPOS is the marketing name for a pricing model where the merchant pays nothing for terminal hire or transaction fees, because the fee is automatically added to the customer's bill at the point of sale as a surcharge.
That model relies on the surcharge being legal. From 1 October 2026 it is not, at least for Visa, Mastercard, and EFTPOS volume. Providers selling zero-cost plans have two paths: convert their merchants to a flat-rate plan, or restructure as a hybrid that surcharges only AMEX and international cards.
For the merchant, the question is the same: what is my real cost of payments going to look like on 1 October?
Take a cafe doing $50,000 a month in card sales. On a zero-cost plan today, the fee is zero because the customer is paying roughly $700 to $900 a month in surcharges. From October, that same fee falls on the business. The realistic options are:
- Stay on the same provider's flat-rate plan and absorb the fee. Reprice the menu by 1% to 2% to recover most of it.
- Switch to a competitive flat-rate plan. At $50,000 a month, the difference between 1.6% and 1.1% is around $250 a month, or $3,000 a year.
Real flat-rate options as of May 2026 include Zeller at 1.4% inclusive of GST (Zeller provider page), Square at 1.6% (Square provider page), CommBank Smart at 1.1% for existing CommBank customers, and SumUp at 1.4%. The right choice depends on hardware preferences, settlement timing, and how cleanly the terminal integrates with your point-of-sale software.
The interchange fee cap: 0.3% on consumer credit cards
Interchange is the wholesale fee a card issuer (your customer's bank) charges the acquirer (your payments provider) on every transaction. The acquirer passes it through to you either explicitly (interchange-plus pricing) or implicitly (flat-rate pricing).
Today, the average interchange rate on a Visa or Mastercard consumer credit transaction in Australia sits in the 0.5% to 0.8% band, with premium cards higher. From 1 October 2026, the weighted average cap drops to 0.30%, bringing Australia roughly into line with European Union and United Kingdom rules.
What it means for your bill depends on how your provider prices.
If you are on interchange-plus pricing, the saving flows straight through. The lower wholesale rate appears on your statement from October. Mid-sized venues using providers like Tyro (Tyro provider page) or Stripe's interchange-plus tier (Stripe provider page) sit in this bucket.
If you are on flat-rate pricing (Zeller, Square, SumUp, most CommBank Smart plans), the cap does not automatically reduce your rate. The provider keeps the saving as margin unless competitive pressure forces a cut.
The practical takeaway: interchange-plus customers should see lower statements from October without doing anything. Flat-rate customers should watch the market over Q4 2026 and Q1 2027 for rate cuts, and renegotiate or switch if their provider does not pass any benefit through.
The $910M question, where do the savings go?
The RBA's modelling puts the total annual saving to Australian merchants at roughly $910 million once the package is fully in effect. The honest question is whether that saving stays with businesses or flows on to consumers.
Two outcomes are realistic.
Merchants keep most of it. Businesses that already price-in their surcharges (the corner cafe charging 1.5% on cards today) keep the markup but lose the surcharge line on the receipt. Headline prices stay where they are, and the saving becomes margin.
Customers see modest price falls in commoditised categories. In coffee, takeaway, and high-frequency convenience retail, competitive pressure may force one or two operators to drop headline prices once the surcharge line disappears, and others will follow.
The realistic split, at least through the first twelve months, is heavily weighted toward merchant retention. Larger chains with publicly listed pricing and strong competition (quick-service restaurants, supermarkets) face the most pressure to pass the benefit on. Independent operators are likely to bank it.
What merchants should do right now
Five practical steps, in order of priority.
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Audit your current effective rate. Pull the last three months of merchant statements and divide total fees by total card turnover. That single number, expressed as a percentage, is your real cost of payments. Most businesses are surprised at what they find. Once you have it, benchmark against the live rates on our comparison page to see whether you are paying more than market.
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Check your contract for a zero-cost or surcharge-pass clause. If your plan relies on the surcharge to keep your fees at zero, the model breaks on 1 October. Contact your provider now and ask for a written quote on their flat-rate alternative. Get it in writing before queues build through August and September.
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Decide between flat-rate and interchange-plus. Small to medium merchants doing under $1 million a year in card turnover almost always come out ahead on flat-rate (Zeller, Square, SumUp, CommBank Smart). Mid-sized venues over $1 million, particularly those with steady debit volume, usually save with interchange-plus (Tyro, Stripe, Adyen). The crossover point sits around $80,000 to $100,000 a month, but it varies by mix.
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Update your menu, signage, and online checkout. Surcharge notices on doors, menus, EFTPOS terminals, and online checkout flows need to come down or change wording before 1 October. If you were absorbing the surcharge into customer pricing, this is the moment to rework headline prices and communicate the change to repeat customers ahead of time. Holding off until the day will look reactive.
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Get help if your statement is complicated. Businesses with multiple terminals, AMEX volume, international card exposure, or interchange-plus pricing often leave money on the table because the math is hard. Our services team does one-on-one statement reviews and provider negotiation for a flat fee.
Provider rates at a glance (as of May 2026)
The Australian market has roughly ten providers competing for small and mid-sized merchant business. Headline rates as of May 2026 are below.
| Provider | In-person | Online | Monthly fee | Best for |
|---|---|---|---|---|
| Zeller | 1.4% (incl. GST) | 1.7% + $0.25 | $0 | Flat-rate hospitality and retail |
| Square | 1.6% | 2.2% | $0 | No-lock-in small business |
| CommBank Smart | 1.1% | quote | $0 | Existing CommBank customers |
| SumUp | 1.4% | quote | $0 | Tradies and pop-ups |
| Tyro | quote | 1.7% + $0.30 | quote | Mid-sized venues, 300+ POS integrations |
| Stripe | 1.7% + $0.30 | 1.7% + $0.30 | $0 | E-commerce and SaaS |
| NAB | 1.15% flat / 1.4% Easy Tap | quote | $25 rental | NAB business customers |
| Westpac | 1.2% flat / 1.4% Air | quote | $24.75 rental | Westpac business customers |
Rates current at May 2026. Compare live rates and run a fee calculation at our comparison page.
Frequently asked questions
When does the RBA surcharge ban take effect?
The ban takes effect on 1 October 2026, the same day the 0.3% interchange cap on consumer credit cards begins. The RBA announced the package on 31 March 2026, giving merchants and acquirers six months to update contracts, pricing, signage, and point-of-sale systems.
Can I still surcharge AMEX or Diners after October 2026?
Yes. The ban covers EFTPOS, Visa, and Mastercard only. Surcharges on American Express, Diners Club, JCB, and other schemes outside the RBA's designation remain legal. Most cafes and small retailers passing on AMEX surcharges today can keep doing so, provided the surcharge does not exceed the actual cost of acceptance.
What happens to my zero-cost EFTPOS plan?
The pass-through model that makes zero-cost EFTPOS work is no longer legal for Visa, Mastercard, and EFTPOS transactions from 1 October 2026. You will either absorb the fee on the same provider's flat-rate plan or switch to a competitive flat-rate offer. Compare the alternatives on our comparison page.
Will the 0.3% interchange cap reduce my fees automatically?
Only if you are on interchange-plus pricing. The new cap applies to the wholesale fee that your provider pays, and on interchange-plus the cost is passed straight through. If you are on flat-rate pricing, your headline rate does not move unless your provider chooses to cut it in response to competitive pressure.
Can I just raise my prices to cover the fee?
Yes. Repricing your menu or product list to cover the cost of card acceptance is the standard response, and the simplest. The rule is that you cannot itemise the cost as a card surcharge on the receipt. You can absorb it into headline prices freely.
What about BNPL services like Afterpay and Zip?
BNPL transactions are not covered by the surcharge ban. You can still pass on the BNPL fee to the customer, subject to the rules each BNPL provider sets in your merchant agreement. Some BNPL contracts prohibit surcharging directly, so check your terms before relying on it.
The bottom line
1 October 2026 is a hard deadline. Every Australian business that accepts a card needs to know what their effective rate will look like on the day, whether their current contract still makes sense, and how they will communicate any price changes to their customers. The work to do that takes hours, not weeks, but it has to happen before the queues fill up at acquirer support desks in late September.
Compare ten Australian providers and run a fee calculation in under five minutes. If your statement is complicated or you want a human in the loop, our services team reviews statements and negotiates with providers on your behalf.
