Surcharges Banned: Cash Payments on the Rise as Small Businesses Feel Pinch

The Reserve Bank of Australia is implementing a ban on surcharges from October 1st, which will remove extra fees for payments made on credit and debit cards. This change is expected to save Aussies $1.6 billion per year, but it may not be all good news for small businesses.

Currently, these businesses can charge extra fees for card transactions, but this income stream will now disappear. However, experts believe they might look for alternative ways to recoup their losses, including offering discounts for cash payments.

According to Professor Steve Worthington from Swinburne University, small and medium-sized businesses who surcharge at the moment will lose this income stream, but they may be able to offer customers discounts for those who pay by cash. This could see a resurgence in cash use across the country, which has been declining in recent years.

Cash use remains a common payment method, especially among older Aussies or those living in urban areas. Jason Bryce, a pro-cash campaigner, expects more small businesses to prefer cash payments and even go cash-only due to the ban on surcharging.