“Cart before the horse”: Calls for surcharge ban timeline – BeanScene

The Council of Small Business Organisations Australia (COSBOA) says the Reserve Bank of Australia’s (RBA) decision to remove card surcharging without first ensuring lower costs are delivered to small businesses risks shifting more pressure onto already tight margins.

The RBA announced its decision to ban card surcharging on sales from 1 October 2026 amid a range of card purchasing reforms, as surcharging is “no longer achieving its intended purpose of steering consumers towards making more efficient payment choices”.

COSBOA Chair, Matthew Addison, welcomes the RBA’s focus on reducing payment costs, but has warned against implementing the changes without guaranteeing lower fees.

“If you ban surcharging without guaranteeing lower fees, small businesses have no choice but to absorb the cost and that will ultimately be reflected in prices,” says Matthew.

“Lower fees are only meaningful if small businesses actually see the benefit in what they’re charged.

“Without clear pass-through, this reform doesn’t deliver real relief.”

COSBOA says it is calling for a clear implementation timeline to enable small businesses to realise lower costs, access clear pricing information, and make informed decisions before surcharging is removed.

It says the package must deliver real reductions in payment costs that are passed through to small businesses, clear and accessible pricing so businesses can compare providers, and wider availability of least-cost routing to keep payment costs down.

“Banning surcharges before businesses can see lower fees and understand their costs is putting the cart before the horse,” continues Matthew.

“In a system without surcharging, transparency and least-cost routing become essential to keeping things under control.

“Small businesses will need time to see the impact of these changes, adjust their pricing, and update systems.

“Without a practical transition, they risk being hit with the cost before the benefits arrive.”