The Australian Retail Council (ARC) said today’s Reserve Bank of Australia decision to ban card surcharges will add to cost pressures across the retail sector, particularly for smaller businesses already operating on tight margins.
ARC CEO Chris Rodwell said while lower interchange fees and stronger transparency measures for businesses are positive steps, the removal of surcharging strips away a significant cost recovery mechanism.
“Retailers don’t surcharge by choice. Lower interchange fees and greater transparency are welcome steps, but they do not eliminate the cost of accepting card payments, nor do they guarantee that savings will be passed through in full. Removing surcharges reduces the flexibility retailers have to cover those costs, and that pressure will be felt most by smaller businesses already facing a cost-of-doing-business crisis,” Mr Rodwell said.
“This is another layer of cost in a system where retailers are already dealing with rising expenses across wages, energy, rent, compliance and supply chains. The focus must now be on reducing the overall cost of doing business, not adding to it,” he said.
The RBA has confirmed surcharging on debit and credit cards will end from 1 October 2026.