The Reserve Bank of Australia is gearing up to scrap card surcharges on EFTPOS, Mastercard and Visa debit, prepaid and credit cards. They’re also lowering the cap on interchange fees that businesses pay. All of this is set to kick in from 1 October 2026.
On the surface, getting rid of surcharges sounds like a win for everyday shoppers. But there’s a catch: the reduction in the interchange fees will probably make rewards credit cards less generous over time. That’s because interchange fees are a big part of what funds reward programs. When that revenue drops, banks have less money to pour into points, sign‑up bonuses and premium perks.
What is changing?
The big headline changes announced by the Reserve Bank of Australia are:
- A complete ban on debit and credit card surcharges
- Lower caps on interchange fees for most card transactions
- More transparency from card networks so merchants can actually see what they’re being charged in wholesale and scheme fees
The first two are the real game‑changers here. The first will affect you when you’re out shopping or paying for flights or hotel rooms. The second will likely have impacts on points earning from credit cards.
What the RBA’s decision means for you
Surcharges
Starting 1 October 2026, businesses won’t be allowed to tack on a surcharge when you pay with EFTPOS, Mastercard or Visa. That little extra fee you sometimes see at the checkout or on a payment terminal will be a thing of the past. It’s worth noting, though, that this rule doesn’t cover every payment type. American Express and a few others sit outside the new regulation.
In practical terms, this means no more surprise add‑ons popping up after you tap your card. Every business that processes payments in Australia will need to follow the new rules.
It’s good news for anyone who travels around the country. It means those annoying payment surcharges from major airlines, rental cars, and pretty much every hotel your stay in will finally be gone.
Interchange Fees
Interchange fees are the behind‑the‑scenes charges your bank receives from the merchant’s bank every time you tap or swipe your card. They’re usually a small percentage of whatever you’re buying, but they add up across millions of transactions.
The Reserve Bank now wants to tighten the rules by lowering the maximum interchange fees on most card types. It’s also getting rid of the old “benchmarks” that limited the average fees card networks could collect across all transactions. In short, the whole system is about to get stricter.
Here’s how the new caps will look:
- From 1 October 2026, the cap on debit card interchange fees drops from 0.2% to 0.16%, or from 10 cents to 8 cents for fixed‑fee transactions. The benchmark stays at 8 cents.
- From 1 October 2026, the cap on consumer credit cards falls from 0.8% to 0.3%
- From 1 April 2027, the cap on foreign‑issued cards (like when a tourist taps their overseas card) drops from 2.4% to 1%.
Effect on points
If you’re like many frequent flyers, a big chunk of your points probably comes from everyday credit card spending. A lot of those points are funded by the interchange fees your bank collects. A such, when those fees shrink, the rewards programs usually follow.
Over time, this could mean fewer points per dollar, smaller sign‑up bonuses and trimmed‑back perks. Some banks may even lift annual fees to make up the difference.
We saw this happen in 2017, the last time the Reserve Bank forced reductions in the interchange rates. The banks quickly followed with cuts to points earning cards.
Business cards are a different story. Their cap stays at the higher 0.8%, so they’re less likely to see major changes to rewards or benefits.
Right now, there isn’t a huge gap between the points you can earn on a personal credit card and what you can earn on a business card in Australia. But that balance could shift pretty quickly. If banks start trimming rewards on personal cards, while business cards keep their higher interchange cap, we might see business cards end up in front in the points‑earning stakes.
What about American Express?
In the short term, Amex might actually start to look a little more attractive. Because it operates under a different model, it isn’t covered by the RBA’s interchange caps the way Visa and Mastercard are.
At least, not yet. The Reserve Bank has another review scheduled for mid‑2026, where it plans to look at broader “public interest” issues, including how American Express fits into the picture, as well as other payment services like Buy Now Pay Later.
But for now, Amex cards could temporarily stand out with stronger points earn rates, bigger sign‑up bonuses or more generous perks. Longer term, though, there’s a good chance those benefits will eventually be trimmed back if the RBA decides to bring Amex under similar rules.
Final Words
The RBA’s changes make plenty of sense when you zoom out and look at the whole system, but for everyday people, the impact is a bit more mixed.
For most of us, paying for things should get easier. Those annoying surcharges are set to disappear, and in theory some businesses might pass on the savings in interchange fees. But that remains to be seen. My guess is that it will largely all wash out, and most places will keep prices steady.
You could also argue there’s a fairness angle at play here. Right now, everyone ends up covering the cost of credit card rewards through higher prices, even if they never touch a rewards card. These changes will help balance things out.
But if you’re someone who chases points and perks, October could hit hard. With interchange fees dropping significantly, it’s pretty realistic to expect reward earn rates to take a serious dive.
