RBA Card Surcharges Banned, Businesses Face Lower Payment Costs

Australia's Reserve Bank of Australia (RBA) has implemented new reforms that ban businesses from passing on card payment costs to customers through surcharges, effective October 1.

The changes apply to eftpos, Visa, and Mastercard payments, as well as lower domestic interchange fee caps. Interchange fees are the portion of card payment costs that flow to the customer's bank.

Retail Drinks Australia CEO Michael Waters expressed concern about the impact this may have on retailers, particularly small businesses operating on tight margins.

Australian Banking Association (ABA) CEO Simon Birmingham said the changes remove a common nuisance for consumers and will result in lower payment costs for businesses. He expects these reductions to deliver around $660 million per year.