The card surcharge left the checkout on 1 October, and the wholesale fee behind every tap fell on the same day. An analysis of twenty popular card plans has found seven have cut their merchant rates.
What's happening?
On 1 October the Reserve Bank cut the maximum interchange fee on domestic-issued credit cards from 0.8 per cent to 0.3 per cent. Interchange is the wholesale fee behind a card payment, paid to the customer's bank. The RBA estimates the lower caps will save businesses around $910 million a year.
Compayr, a comparison site started by payments sector veteran Dougal Anderson, tracks twenty popular card acceptance plans. Its comparison, reported by SmartCompany on 19 October, found seven had cut their rates for merchants.
Westpac leads as of 19 October, with its flat transaction fee down from 1.2 per cent to 0.79 per cent on point-of-sale payments. Commonwealth Bank, NAB, ANZ Worldline, Zeller POS and Shopify Basic flat rates have also fallen, along with Stripe's online rate. Westpac's cut was announced in September.
Only one plan tracked has passed on the full half-point cut: Commonwealth Bank's Interchange Plus and Interchange Plus Plus plans. Flat rates bundle all costs into a single percentage; interchange-plus plans pass the wholesale fee through with a mark-up on top.
Compayr says its rankings rest on cost alone, and notes it earns referral fees from some providers it lists. Its comparison does not factor in terminal rental or switching costs.
Who it affects
“Whether a provider is right for your business is a decision only you can make — we just make sure you know what it costs,” Anderson told SmartCompany. The Australian Banking Association says if small businesses do not see their card costs fall, other players in the payments system will have absorbed the savings.
Consumers sit on the other side. The RBA estimated consumers paid about $1.6 billion of the $1.8 billion in card surcharges collected each year, and that charge is gone. It has also said card costs can be reflected in pricing.
In commentary reported by SmartCompany, Labor MP Jerome Laxale said the transparency measures would help businesses shop around, while minister Kristy McBain suggested the RBA could require banks to absorb merchant card acceptance costs.
What it means for you
If you run a business, check your effective rate: total card costs on your statement divided by card turnover. Ask your provider whether you are on a flat rate or an interchange-plus plan. Large banks must publish their pass-through from 30 January 2027.
For diners, the checkout is unchanged: no card surcharge, and weekend, public holiday, booking and service fees stay as they are. As of 19 October, seven of twenty tracked plans had passed on lower merchant rates.
Happy dining! G