$66 Credit Card Fee Reveal: RBA Moves to Ban Surcharges

Australians are facing significant credit card fees when booking international flights and adding new payment methods at checkout, with some customers being charged as much as $66 in surcharges. This is due to a sliding scale fee based on a percentage of the overall purchase price, which can range from 0.2% to 10%. The practice has come under intense scrutiny as more people move towards card-only transactions.

The Reserve Bank of Australia estimates that the cost of moving away from cash and becoming reliant on debit and credit cards is costing Australians $1.6 billion a year in surcharge fees. In response, the RBA announced that surcharges on credit cards and debit cards will be banned as of October 1.

The ban aims to make accruing debt via rewards cards less attractive by cutting points earning by up to 50%, increasing annual fees, and reducing lounge access. Credit card surcharge fees will be capped at 0.3%, while debit card fees will be capped at 0.16%. Foreign-issued cards like American Express will have a cap of 1%.

While the ban may not reduce the number of people using credit cards, it is expected to make them less attractive by making points earning and rewards less valuable.