RBA Card Surcharge Changes: What Small Businesses Should Do Before 1 October 2026

Key Statistics

Australian businesses have less than two months to prepare for one of the most visible changes to card payments in years. The Reserve Bank of Australia has concluded that it is in the public interest to remove surcharging for the designated card networks.

The mechanism is important. The RBA is lifting its prohibition on card-network no-surcharge rules from 1 October 2026. eftpos, Mastercard and Visa have each announced that they will introduce those rules from that date, while American Express has separately announced that it will also remove surcharging.

This guide explains:

• What changes on 1 October 2026
• Why card acceptance costs will still matter
• How to assess the impact on pricing and margins
• What small businesses should do before the change takes effect

What Changes on 1 October 2026

The RBA's Review of Merchant Card Payment Costs and Surcharging concluded that competition and efficiency would be improved by removing card surcharging and lowering selected interchange caps.

From 1 October 2026, the RBA will remove its prohibition on no-surcharge rules for designated debit, prepaid and credit card networks. This allows eftpos, Mastercard and Visa to prohibit merchants from adding a separate surcharge because a customer pays by card. Each of those networks has announced that it will do so from that date.

Key points for businesses include:

• The changes apply to surcharges added because a customer pays by card
• eftpos, Mastercard and Visa have announced no-surcharge rules from 1 October 2026
• American Express has also announced removal of surcharging from the same date
• Weekend, public holiday, booking and service fees are not card-payment surcharges simply because they are separate fees
  

Businesses should confirm the implementation details that apply to their checkout, terminal and invoicing setup with their acquirer or payment service provider.

Why the RBA Is Changing Card Surcharging

Card surcharges were designed to make payment costs visible and allow merchants to recover the cost of accepting a particular card. Over time, however, the RBA found that the arrangements had become complex for businesses and consumers.

The RBA's conclusions also recognise that card payment costs remain significant for merchants, particularly smaller businesses. That is why the surcharge change is being introduced alongside lower interchange caps and greater fee transparency.

• Customers receive simpler, more inclusive advertised pricing
• Businesses still need visibility over the true cost of accepting cards
• Lower wholesale card costs are intended to reduce pressure on merchants

For small businesses, the practical question is therefore not just whether a surcharge disappears. It is whether the business understands what each payment method costs and how those costs flow through to margin.

What This Means for Small Businesses

Businesses will still incur card acceptance costs after 1 October 2026. For merchants that already absorb those costs, the direct pricing impact may be limited. Businesses that currently recover some or all of their card costs through a surcharge face a clearer margin decision.

Consider a business processing $50,000 a month in card sales at an illustrative all-in acceptance cost of 1.5%. That represents approximately $750 a month in card costs. If the business currently recovers that amount through a card surcharge, it needs to decide how that $750 will be handled once the surcharge is no longer available.

Possible responses include:

• Absorbing some or all of the cost within existing margins
• Adjusting overall advertised prices
• Negotiating a better acquiring or payment-provider arrangement
• Reviewing the mix of card and account-to-account payment methods

There is no single correct approach. The right payment mix depends on transaction value, customer preference, payment channel, settlement requirements and the provider contract.

How Card Payment Costs May Change

The surcharge changes arrive at the same time as new domestic interchange caps. From 1 October 2026, the cap on domestic-issued consumer credit card transactions acquired in Australia will reduce to 0.3% of transaction value.

For domestic debit and prepaid cards:

• The per-transaction interchange cap will reduce to 8 cents
• The percentage cap will reduce to 0.16% of transaction value
• The weighted-average interchange benchmark remains 8 cents per transaction

These are wholesale interchange settings — not the final merchant service fee a business pays. Total card acceptance costs can also include scheme fees, acquiring margin, gateway charges, terminal costs and other provider fees.

Businesses should ensure they understand:

• their effective all-in card acceptance cost
• how their provider will pass through the interchange changes
• the operational cost of settlement, failed payments and reconciliation

Payment Choice Becomes a Commercial Decision

The surcharge change should trigger a broader payment review rather than a simple decision to increase prices or replace cards. Cards remain familiar to customers and are deeply embedded in ecommerce and digital-wallet journeys.

Useful questions include:

• What percentage of our revenue currently comes through cards?
• What is our actual all-in cost of card acceptance after every fee?
• How will our payment provider change pricing from 1 October?
• How important are settlement speed and reconciliation to our workflow?
• Where could a bank-payment option provide a better fit for the customer and the business?

Account-to-account options such as PayTo can form part of that assessment. Australian Payments Plus describes PayTo as supporting one-off, ad hoc and regular payments directly from a customer's bank account, with customer authorisation through online banking and payment information that can support reconciliation.

PayTo is not a universal replacement for cards. Customer preference, participating-bank support, agreement settings, transaction limits and provider capabilities all matter. Many businesses will be better served by a deliberate mix of payment methods. See bank payments vs card payments and PayTo for small business.

Five Actions to Complete Before 1 October 2026

Businesses that currently accept cards should use the remaining transition period to understand their payment economics and make any customer-facing changes before the new rules take effect.

Practical steps include:

• Measure your payment mix across debit cards, credit cards, PayTo, PayID, direct debit and bank transfer
• Calculate the actual all-in cost of card acceptance from recent merchant statements
• Ask your provider when surcharge functionality will be disabled and how pricing will change
• Review advertised prices, invoices, payment pages and customer terms
• Test alternative payment journeys using completion, settlement, reconciliation and total cost — not transaction price alone

Businesses that issue invoices should pay particular attention to the transition. The RBA states that if a card payment is made on or after 1 October 2026, surcharging may no longer be available even if the invoice was issued earlier. Check the implementation approach with your payment service provider before the changeover.

Payments Key Takeaway

The surcharge changes are more than a checkout configuration update. They change how businesses that currently surcharge cards recover payment costs.

The strongest preparation is to know the actual cost of each payment method, how quickly it settles and how well it fits the business workflow.

Small businesses that complete that review before 1 October will be better placed to protect margin without simply defaulting to higher prices or a single payment method.

Key Payment Terms Explained

Card surcharge

A card surcharge is an additional fee charged because a customer chooses to pay using a card. From 1 October 2026, eftpos, Mastercard and Visa have announced no-surcharge rules, and American Express has also announced that it will remove surcharging.

Merchant service fee

A merchant service fee is the amount charged by a payment provider for card acceptance. Depending on the provider and pricing model, it may reflect interchange, scheme fees, acquiring margin and other service costs.

Interchange fee

Interchange is a wholesale fee paid between participants in a card transaction. The RBA regulates interchange caps for designated card systems; the cap is not the same as the final merchant fee.

Settlement

Settlement is the movement of payment funds through to the business. Settlement timing varies by payment method and provider and can affect cash flow and reconciliation.

Important Facts About Australia's Payment Regulation Changes

• The RBA's Review of Merchant Card Payment Costs and Surcharging concluded in March 2026.
• The RBA will lift its prohibition on no-surcharge rules for designated card networks from 1 October 2026.
• eftpos, Mastercard and Visa have announced no-surcharge rules from that date; American Express has announced the same outcome.
• New domestic interchange caps also take effect on 1 October 2026.
• Additional merchant fee transparency measures are being introduced across late 2026 and 2027.

Sources

Reserve Bank of Australia
Review of Merchant Card Payment Costs and Surcharging — Conclusions Paper
March 2026

RBA Conclusions Paper in Brief
RBA Frequently Asked Questions — Removal of Payment Surcharges From 1 October 2026
Australian Payments Plus — PayTo for Businesses

Related Payment Guides

Bank payments vs card payments for Australian businesses
PayTo for Australian small businesses