RBA Cracks Down on Card Fees: Big Changes for Shoppers

Aussie shoppers could soon be saying goodbye to pesky credit and debit card fees, with the Reserve Bank of Australia (RBA) proposing a major shake-up to how businesses apply payment surcharges.

The central bank has announced plans to ban retailers from charging more than the actual cost of processing a card payment, aiming to put an end to what it calls “unreasonable” and often excessive fees being passed onto consumers.

Why the Change?

Right now, businesses are allowed to recoup what they pay to payment providers – think EFTPOS terminals and card networks like Visa or Mastercard – by adding a surcharge to your purchase. But the RBA says too many businesses are going above and beyond the true cost, particularly when it comes to flat fees on small transactions.

Picture this: you grab a $4 coffee and get slugged with a 50-cent card surcharge. That’s over 12% extra – way more than it costs the café to process the payment. And it’s exactly the kind of scenario the RBA wants to stamp out.

What’s Being Proposed?

Under the draft changes, the RBA is pushing for:

• A cap on surcharges, ensuring they match the real cost of processing the transaction.

• A move away from flat-fee surcharges, especially for small purchases.

• Stronger encouragement for least-cost routing, where businesses use the cheapest payment method available (e.g. routing debit card payments via EFTPOS instead of international networks).

• Potential enforcement measures through collaboration with the ACCC.

The reforms are designed to make the system fairer and more transparent, not just for shoppers, but for small businesses too.

Consumer Win, or Red Tape for Retailers?

The proposal has sparked mixed reactions. Consumer advocates are cheering the move, saying it will protect Aussies from being overcharged for simply tapping their card.

Retailers, on the other hand, are a bit more cautious. Some worry that stricter rules could increase admin headaches or cut into already tight margins. Still, the RBA is standing firm. Governor Michele Bullock said the goal is to “make card payments more affordable for everyone” and reduce cost-of-living pressure where possible.

What Happens Next?

The proposed changes are now open for public consultation, with final rules expected to be locked in later this year. If they go ahead, the new system could roll out in early 2026.

Until then, the RBA is urging consumers to stay alert to card fees, and for businesses to keep things fair at the checkout.