The Reserve Bank of Australia (RBA) has released a Consultation Paper as part of its ongoing review of merchant card payment costs and surcharging. This follows an extensive public consultation process since the release of an Issues Paper in October 2024.
The Payments System Board has reached a preliminary view that removing surcharges on eftpos, Mastercard, and Visa cards would be in the public interest. Consumers currently pay around $1.2 billion annually in card surcharges. The board noted that “surcharging is no longer achieving its intended purpose of steering consumers to make more efficient payment choices.” It has become increasingly difficult for consumers to avoid surcharges as cash usage declines, businesses charge uniform surcharge rates across debit and credit, and enforcing current rules presents significant challenges. Removing these surcharges could simplify card payments, increase transparency, and enhance competition within the card payments system.
Additionally, the RBA proposes lowering the cap on interchange fees paid by businesses, potentially saving them approximately $1.2 billion annually. The proposed policy changes are estimated to benefit around 90 percent of Australian businesses, with small businesses likely to gain the most due to their proximity to existing fee caps. Introducing caps on foreign interchange fees could further reduce costs for all businesses accepting international cards.
The RBA also suggests requiring card networks and large acquirers to publish their fee structures. This move aims to improve transparency and competition by enabling all parties involved to better understand the fees they incur and facilitate easier comparison shopping for better deals.
Feedback on these proposed policy options and draft standards is invited by August 26, 2025. The RBA will use this feedback to finalize reforms aligned with its objectives for a safe, competitive, and efficient payments system. Conclusions from this consultation process along with an implementation timeline for any regulatory steps are expected by year-end.
