The Council of Small Business Organisations Australia (COSBOA) is urging Australians to understand the pressures facing small businesses as they adjust to new card surcharge rules from 1 October.
From that date, businesses will no longer be able to add a surcharge when customers pay using Visa, Mastercard, American Express or eftpos cards.
The change will particularly affect small businesses that currently use surcharging to recover the cost of accepting card payments. Small merchants can pay substantially more to accept card payments than larger businesses, making it harder for them to absorb additional costs.
COSBOA CEO Skye Cappuccio said this left many small businesses with difficult decisions about how they manage those costs from October.
"For a small business, there is no such thing as a cost that simply disappears. It either comes out of an already tight margin, has to be recovered somewhere else, or the business has to find a cheaper way of doing things," Ms Cappuccio said.
"Every business is different. Some may be able to absorb some or all of the cost, while others may need to review their overall pricing or payment arrangements.
"Small businesses know their customers are managing cost-of-living pressures too and any decision to change prices will be carefully considered. If people do notice changes at their local café, restaurant, butcher, retailer or other small business, we want them to understand some of the pressures sitting behind those decisions."
The card surcharge ban comes during an already challenging period for small businesses, with rising operating costs, tighter margins and a range of regulatory and operational changes all placing demands on owners.
"Small businesses have less capacity to carry additional costs and less bargaining power than their larger competitors when it comes to negotiating payment fees," Ms Cappuccio said.
"It has been a big year of change for the sector, and each new requirement takes time and resources to understand and implement. These are the businesses that employ local people, provide products and services we rely on and help keep local communities strong. We encourage Australians to continue supporting the small businesses they value."
COSBOA welcomed planned reductions in interchange fees, which should help reduce the cost of accepting card payments, but said the timing remained a concern.
"We would have preferred the interchange fee changes to have fully flowed through first, so small businesses knew what their payment costs would look like before having to make pricing and budgeting decisions ahead of 1 October," Ms Cappuccio said.
"What matters now is that those intended reductions translate into lower merchant costs for small businesses."
The changes relate specifically to card surcharges. Weekend, public holiday and other non-card surcharges are not affected and can continue to apply in accordance with existing requirements.
