RBA decision to remove surcharging set to reshape payment strategies.
The Reserve Bank of Australia has confirmed that card surcharging will be removed from 1 October 2026. Here is what changes, how it affects different industries, and how businesses can prepare.
RBA confirms end of surcharging, signalling a shift towards service-led payments
The Reserve Bank of Australia has confirmed a major shift in the local payments landscape. From 1 October 2026, card surcharging will be officially removed. This landmark decision marks a significant change in how Australian businesses manage payment costs and navigate the customer experience.
Under the new regulations, businesses will no longer be permitted to apply surcharges on Visa, Mastercard or eftpos transactions. To help balance these changes for merchants, the RBA is also reducing interchange caps. Notably, the consumer credit interchange rate will decrease from 0.80 per cent to 0.30 per cent.
The decision follows an extensive consultation period involving industry peers, our partners and the team at ZenPay. We remain committed to providing professional and reliable guidance as the industry transitions. We believe simplicity in payments is key to building trust, and we are here to help our clients adapt their strategies to thrive under the new standards.
Impact across industries
For a long time, surcharging has been a practical way for businesses to recover the cost of card acceptance. Its removal will be felt across the Australian economy, especially in industries where card payments are the standard for high-value or recurring transactions.
The impact will vary by sector:
- Where margins allow more flexibility, businesses may find it easier to absorb payment costs as part of a premium service offering.
- Where margins are tighter and pricing is fixed, the challenge is more significant. These businesses will need a strategic review of pricing models and payment workflows to ensure long-term sustainability.
Despite these changes, consumer habits remain clear. Data observed by ZenPay shows that card payments continue to be the preferred method for the majority of Australians. Businesses must find a balance: managing the internal cost of transactions while still meeting the high expectations for convenience and flexibility that modern customers demand.
Costs reduced, but no longer recoverable
The reduction in interchange rates will lower some expenses, but it won’t eliminate the cost of accepting card payments. The key change is that businesses will no longer have the option to pass these costs directly to customers through surcharges.
At ZenPay, we predict this shift will further influence how people pay. Without the barrier of additional fees, we expect even more customers to choose card payments across industries. That makes a streamlined, efficient payment strategy more important than ever.
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.”
A shift toward service, choice and flexibility
Industry experts expect the removal of surcharging to move the focus from simple cost recovery to the overall quality of the payment experience.
Rather than relying on a single method, businesses are likely to offer a more strategic mix of options that balances cost, convenience and customer preference. Lower-cost alternatives like PayTo, PayID and bank transfers are expected to play a more prominent role alongside traditional card payments. Offering these choices is the best way to meet customer expectations while managing your bottom line.
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 becomes 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, show that card payments remain the preferred method for many customers, particularly where convenience and rewards matter. 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 card usage stays strong.
The transition period ahead
With the changes taking 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
ZenPay 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 of payments
The removal of surcharging is 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.
From payments as a recoverable cost, to payments as a core part of service delivery.