What foodservice operators should consider following card payment surcharge changes
/The Reserve Bank of Australia’s decision to remove card payment surcharges from October 1 means foodservice businesses may need to consider how they manage the costs associated with accepting card payments if they applied card surcharges prior to October 1.
As these costs can no longer be partially recovered through card surcharges applied at point of payment, they instead need to be managed in line with your broader pricing and operational policies.
“Foodservice businesses may wish to review their pricing and operating costs to account for expenses previously recovered through card surcharges, however with interchange fees also being lowered we can already see payment providers lowering their merchant fees, which will help manage some of that cost” says Restaurant & Catering Australia National President John Hart OAM.
“Some customers may not understand that although the surcharges have been banned, foodservice businesses still have to pay the costs associated with payment processing.
“We are seeing some businesses posting notices at point of sale to explain this to customers, and some are trying to soften the announcement that they’ve had to increase their prices by offering a discount for cash payments.
“But the bottom line for foodservice businesses is that it costs the business as much to take payments by cash as it does by credit card, once you factor in the time and cost associated with record keeping and depositing cash in the bank.”
The good news is that along with the surcharge ban, the RBA has lowered the cap on bank interchange fees for electronic transactions. From October 1, the cap of debit and prepaid card interchange fell from 0.2% to 0.16% (or from 10 cents to 8 cents where a fixed fee applies), and the cap on consumer credit card interchange fell from 0.8% to 0.3%.
While these savings should show up as lower merchant service fees, you shouldn’t assume that will happen automatically. Instead, food service operators should check if their payment provider has lowered their merchant fees.
“At the end of the day, the RBA decision has resulted in a reduction of interchange fees, which is not a bad outcome for our industry,” John says. “However, it remains important for foodservice operators to understand their payment costs and check whether any reductions are reflected in the fees they pay.”
“That’s why it’s important to examine your merchant statement carefully, as well as check with your payment provider so you know what merchant fees you’re now paying on debit vs credit card transactions.
“If you have questions about the fees you are paying, speak with your payment provider and ask them to explain the costs shown on your merchant statement.
“When reviewing payment providers, operators should consider the overall value offered, including pricing, service, reliability, support and the provider’s experience working with businesses in the sector.”
Large payment providers are required to publish their fee information from 30 October, giving foodservice operators greater visibility of the fees available across the market. R&CA will also review this information to help its members understand how the changes are being reflected in payment costs.
Some payment providers, such as the R&CA’s Platinum Partner Commonwealth Bank, have been quick to announce a reduction in their merchant service fee. Commonwealth Bank reduced its Merchant Service Fee from 1.1% to 0.99% per transaction on simple flat-rate pricing from 1 October, helping eligible business customers manage the cost of accepting card payments.
Albert Naffah, General Manager Payment Acceptance at Commonwealth Bank, says: “These reforms represent a significant change for some Australian businesses but ultimately they are designed to lower costs for merchants. Businesses should check that surcharges have been removed from every payment channel following the 1 October 2026 change. From 1 October 2026, we also lowered our merchant service fee to 0.99%^ per transaction for eligible CommBank customers on a Single Rate Per Transaction plan. For customers on Interchange Plus (IC+) or Interchange Plus Plus (IC++), merchant fees automatically reflect the new interchange fees.”
What foodservice operators should check:
Check EFTPOS terminals and point-of-sale systems used for in-venue payments.
Review online booking and payment platforms, including deposits and prepayments.
Check payment links and any third-party payment services.
Surcharge references from customer receipts, invoices, websites, pricing displays and venue signage should have been removed.
Run a test transaction through each payment channel to confirm a card surcharge is no longer applied.
If a venue uses more than one location, booking platform, POS system or payment provider, each setup should be checked separately. Contact the relevant technology or payment provider if a surcharge setting has not been removed or cannot be changed. Make sure customer-facing staff understand the change and can answer questions about service prices, deposits, prepayments and payment options. Continue to monitor receipts, invoices and transactions to confirm surcharges are not being applied.
