Surcharge Ban Sparks Fears of Increased Prices and Reduced Payment Options

The Reserve Bank of Australia (RBA) has introduced reforms that ban businesses from adding surcharges to payments made on EFTPOS, Visa, or Mastercard networks. Starting October 1, this means customers will see the price they pay as the price advertised by businesses. For example, a cafe's menu listing an oat latte for A$6.50 won't be able to charge extra for using a debit card or credit card.

This might seem like a win for consumers, but some organizations may increase prices instead of absorbing the remaining costs. Macquarie Bank is already removing the option to pay by credit or debit card directly on its DEFT platform, which processes over 1.2 million rent payments each month. This decision affects an estimated 40% of Australia's rental payments market.

The surcharge ban doesn't make card payments free; banks and payment providers still charge businesses to process and move the money. The RBA has acknowledged that these costs may be reflected in overall prices or alternative service fees, which could create new charges for consumers using lower-cost payment methods.