Author
David HillDirector
If you run a retail or hospitality business, this change lands directly on your margin. From 1 October 2026, you can no longer pass on the cost of accepting a Visa, Mastercard or eftpos payment to your customers, and that cost has to come from somewhere.
What's Changing on 1 October 2026, and Why the Savings Aren't Guaranteed
Businesses can no longer add a surcharge to debit, prepaid or credit card payments across the Visa, Mastercard and eftpos networks. The cost of processing every card transaction, which you could previously recover from the customer, now has to be absorbed into the business or built into the base price.
The Reserve Bank of Australia is lowering the Card Fee, but that's only one part of what a business pays. Under the new rules, businesses must absorb the full Merchant Service Fee, not just the Card Fee.
When a business accepts a card payment through a provider like Square, Stripe or a bank terminal, it's charged a Merchant Service Fee, typically a flat rate around 1.5% to 1.9% per transaction. That Merchant Service Fee is made up of two parts: the Card Fee, the wholesale interchange and scheme cost paid to the customer's bank and the card network, and the Payment Gateway Fee, the margin the payment provider keeps for the terminal, software and support.
Businesses could previously surcharge to recover the full Merchant Service Fee. Under the new rules, neither the Card Fee nor the Payment Gateway Fee can be passed on at checkout.
That distinction matters because the RBA is only capping the Card Fee. The Payment Gateway Fee has no cap, and it doesn't move just because the Card Fee does. If your Merchant Service Fee is a flat 1.6% or 1.9% regardless of card type, a lower Card Fee doesn't automatically lower what you pay, it just means the Payment Gateway Fee makes up a larger share of that rate.
Some platforms sit well above that range. Businesses selling tickets to paid events through Eventbrite have been charged 5.35% plus $1.19 per ticket for some time, a fee that's will now have to be absorbed in its entirety by the business.
So there are two things worth reviewing here, not one: the Card Fee, which a business can't control, and the Payment Gateway Fee sitting on top of it, which you can.
Get a Clear Read on What You're Actually Paying
Before the ban takes effect, it's worth knowing exactly what your current setup costs you, and whether there's a better one available.
Quantum Payments offers an alternative worth considering for businesses that are highly dependent on card payments and want to keep fees down. They combine merchant facilities, cloud POS for retail and hospitality, online payments and reconciliation into one system.
Quantum is offering a free payment health check that reviews your current setup end to end, in-store, online, terminals, settlement and POS, benchmarks it against what's available, and quantifies where the savings might sit. There's no obligation to change providers.
Their service also addresses a separate but related problem: settlement speed. Most merchant facilities still run on a typical settlement delay of 2 or 3 days, while Quantum offers same-day settlement.
Why This Matters Most for Businesses Already Under Pressure
Retail and hospitality are among the most exposed to this change. Both industries process the majority of their revenue through card payments and already operate on thin margins, so even a small increase in unrecovered cost has a direct impact on profitability.
The timing isn't ideal either. Retail insolvency appointments rose to 1,238 in FY26, up from 1,152 the year before, and accommodation and food services saw even more, at 1,819. This reform isn't landing on a healthy sector. It's landing on businesses that are already navigating rate hikes, wage increases, rising costs and weaker consumer demand.
When Cash Flow Pressure Doesn't Let Up
Cash flow stress for a business rarely comes from one bad decision. It builds gradually, wages, rent, stock, tax obligations, and now another cost that used to be recoverable and no longer is.
We speak with business owners every day for whom cash flow strain is the constant backdrop, not the exception. In those conversations, a few percentage points of revenue is often the difference between a business that holds on through a difficult stretch and one that doesn't.
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