Card payment sucharges banned in Australia from 2026

[Doctore1003]

It always astounds me how stupid some of these statements from government departments are. There is no way $1.2b is going to miraculously go from the payment ecosystem into the back pockets of everyday consumers. In what world does the RBA live in?!?

In all likelihood, banks will find a way to plug the gap (which could be devaluing reward points and there by increasing the costs of those consumers that use/benefit from them) and for retailers/merchants that currently surcharge but won't be able to, they'll just increase their prices.

Do they think that businesses (including banks) just willingly give up profits for the fun of it?!?

Just looking at the RBA paper again. They estimate that surcharges are $1.2b per year, which will be fully eliminated, and that the cap on interchange fees will save businesses the same amount of $1.2b per year.

Domestic card issuers are expected to lose $900 million in revenue.

They also state the obvious: "Some issuers may choose to increase cardholder fees or reduce benefits such as rewards points, particularly on credit cards, to boost their profitability in response to reductions in interchange settings."

 

[N0mad]

It always astounds me how stupid some of these statements from government departments are. There is no way $1.2b is going to miraculously go from the payment ecosystem into the back pockets of everyday consumers. In what world does the RBA live in?!?

In all likelihood, banks will find a way to plug the gap (which could be devaluing reward points and there by increasing the costs of those consumers that use/benefit from them) and for retailers/merchants that currently surcharge but won't be able to, they'll just increase their prices.

Do they think that businesses (including banks) just willingly give up profits for the fun of it?!?

it reminds me of when the big banks were told/pressured/regulated (forget which) to not charge ATM fees. Now when i go shopping if i need cash the only ATMs around are independents charging the same fees anyway and Banks have reduced their own fee free ATMs to mostly in branches meaning you need to find a bank branch to find a free ATM.
Not sure how anyone has come out ahead on that one.

 

[muppet]

It always astounds me how stupid some of these statements from government departments are. There is no way $1.2b is going to miraculously go from the payment ecosystem into the back pockets of everyday consumers. In what world does the RBA live in?!?

In all likelihood, banks will find a way to plug the gap (which could be devaluing reward points and there by increasing the costs of those consumers that use/benefit from them) and for retailers/merchants that currently surcharge but won't be able to, they'll just increase their prices.

Do they think that businesses (including banks) just willingly give up profits for the fun of it?!?

But the banks are already devaluing rewards, so at least we’ll get a reduction in surcharges to go with it.

 

[levelnine]

But the banks are already devaluing rewards, so at least we’ll get a reduction in surcharges to go with it.

Rewards can be devalued a whole lot more.

These are currently what are considered the best credit card sign-up bonuses in the UK:

 

[kpc]

Rewards can be devalued a whole lot more.

These are currently what are considered the best credit card sign-up bonuses in the UK:
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Whilst I have benefitted from SUBs myself, I'm not surprised they will get less. I would personally prefer no surcharges at the expense of large SUBs!

 

[Ansett Nostalgic]

We should start a political movement to fight these proposals. Something similar was done to stop a similar proposal in the US not long ago.

 

[gfm]

Whilst I have benefitted from SUBs myself, I'm not surprised they will get less. I would personally prefer no surcharges at the expense of large SUBs!

Best to have the price that is marked on the goods purchased is the price charged by the merchant to the consumer. Silly to have surcharges on the advertised prices (e.g. cc-surcharges, weekend surcharges - in the latter case, the business simply should have a different menu for the weekend if it wants to have higher prices then).

 

[jkbaus]

I suspect many small businesses may up their prices and introduce a discount for cash.
They want cash so it doesn’t go through the books.
Just like employing backpackers/international students, paying under award wages in cash that they don’t put through the books.

 

[oz_mark]

Best to have the price that is marked on the goods purchased is the price charged by the merchant to the consumer. Silly to have surcharges on the advertised prices (e.g. cc-surcharges, weekend surcharges - in the latter case, the business simply should have a different menu for the weekend if it wants to have higher prices then).

There is a legal exemption in the law for weekend and public holiday surcharges.
It was considered wasteful to mandate they produce separate menus.

 

[gfm]

We should start a political movement to fight these proposals. Something similar was done to stop a similar proposal in the US not long ago.

Maybe the opposition party would call itself the "stop sneaky surcharges party" and would perhaps be in coalition with the "prevent payment processing fees party"

 

[burmans]

That's true, although when the made that move in 2003, cash was the main form of payment. That has change in the last 20 years, to the extent that many people don't even carry cash now (and thus can't avoid a surcharge).
While I don't agree with what they did, it seems reasonable to reconsider the situation given the way in which most payments are now made by card.

Agree, when surcharges were first allowed the argument was that the banks had to invest a considerable amount in the infrastructure to support cards and it was fair to recoup some of that expenditure.
Surcharging should probably have had a sunset clause when certain transaction volumes were hit, the banks have well and truly paid off that expense and is anything cash is the thing that should be surcharged. Electronic payments are now much cheaper than cash for the banks!