RBA Confirms End of Card Surcharging, Signalling Shift Toward Service-Led Payments
The Reserve Bank of Australia has confirmed that card surcharging will be removed in Australia from 1 October 2026, marking a significant shift in how businesses manage payment costs and customer experience.
Under the changes, surcharges on Visa, Mastercard and eftpos transactions will no longer be permitted. At the same time, interchange caps will be reduced, including a decrease in consumer credit interchange from 0.80 per cent to 0.30 per cent.
The decision follows an extended consultation period, which included input from Zenith Payments, our partners and industry peers, and is expected to have broad implications across industries where card payments are widely used.
Impact Across Industries
Surcharging has long been used as a mechanism for businesses to recover the cost of accepting card payments.
Its removal will affect a wide range of sectors across the Australian economy, particularly those where card payments are widely used for high-value or recurring transactions.
The impact of these changes will not be uniform across industries. In sectors where margins are higher and customer experience is paramount, businesses may be better positioned to absorb the cost of card payments as part of their overall service offering. However, in industries with tighter margins and pricing options are limited, the removal of surcharging presents more of a challenge, requiring careful consideration of pricing and payment strategies.
At the same time, customer behaviour continues to evolve. Data observed by Zenith Payments indicates that card payments remain the preferred method for many Australians, meaning businesses must balance cost considerations with customer expectations for convenience and flexibility.
Costs Reduced, But No Longer Recoverable
While the reduction in interchange will lower part of the cost base for card payments, it does not eliminate it.
Importantly, businesses will no longer be able to directly pass these costs on to customers through surcharges.
At the same time, the removal of surcharging is expected to influence customer behaviour. Zenith Payments predicts that due to the removal of fees, more payers will choose card as a preferred way to pay across many industries.
Kevin Butler, CEO of Zenith Payments, said the change represents a structural shift in how payments are managed.
“Businesses now need to think about how payment costs are absorbed and managed within their overall pricing and customer strategy. We’re working closely with our clients to help them navigate this shift.”
Shift Toward Service, Choice and Flexibility
Industry participants expect the removal of surcharging to shift the focus away from cost recovery and toward how payments are delivered to customers.
Rather than relying on a single payment method, businesses are likely to place greater emphasis on offering a mix of options in order to balance cost, convenience, and customer preference.
Lower-cost alternatives such as PayTo, PayID and bank transfers are expected to play a more prominent role alongside traditional card payments.
Paul Richardson, Chief Commercial Officer at Zenith Payments, said payment strategy will increasingly centre on customer experience.
This change moves payments into a more service-led model, which aligns with how we’ve always approached payments at Zenith. It’s no longer just about what it costs to accept a payment. It’s about how you give customers choice and flexibility, while still protecting margin.”
Designing Payments Around the Payer
As surcharging falls away, how payment options are presented and experienced will become more important.
Businesses will need to balance:
– The cost of acceptance
– Customer expectations for convenience
– The need for seamless, low-friction transactions
Lessons from Global Markets
Similar changes in markets such as the United Kingdom, where surcharging has not been permitted since 2018, demonstrate that card payments remain the preferred method for many customers — particularly where convenience and rewards are important.
Alongside this, there has been:
- Increased adoption of bank-based payment methods
- Broader payment choice at checkout
- Greater focus on integrated and embedded payment experiences
Rather than replacing cards, these changes have expanded the payment mix, giving customers more flexibility while maintaining strong card usage.
Transition Period Ahead
With the changes set to take effect from 1 October 2026, businesses have some time to review and adjust their approach, including:
- Reviewing pricing and cost structures
- Expanding available payment options
- Ensuring payment experiences remain simple and seamless
Zenith Payments is working with businesses across multiple sectors to support this transition, particularly in optimising payment mix and integrating flexible payment options into existing systems.
A Structural Reset for Payments
The removal of surcharging represents more than a regulatory adjustment. It signals a broader shift: from payments as a recoverable cost, to payments as a core part of service delivery. In this environment, how businesses enable customers to pay and the choices they provide will become increasingly important.
Talk to our team about what this means for your business
We’re working with businesses and software providers to navigate these changes, optimise payment strategies, and balance cost, customer experience and flexibility.
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