The Reserve Bank of Australia (RBA) has announced it wants to end debit and credit card surcharges and lower the cap on interchange fees, after finding the current system was outdated and no longer servicing the public interest. An RMIT expert explains how this change could positively impact small businesses and their customers.
Dr Angel Zhong, Associate Professor of Finance
"Small businesses stand to gain significantly from both the surcharge ban and interchange fee caps. With lower processing costs and simplified pricing, they can focus on serving customers rather than navigating complex payment fees.
"Consumers have been hit with unpredictable surcharges for years. The $1.2 billion in estimated savings is real money back in pockets.
"Banks will take a haircut on interchange revenue, but let's not overstate it-this is about rebalancing, not dismantling. The focus now shifts to efficiency and competition in payment services.
"The devil's in the enforcement. If the RBA doesn't ensure compliance, we could see merchants subtly raising prices or pushing 'cash discounts' that undermine the spirit of reform.
"This is a net positive, but the transition needs careful monitoring. The real test comes in 2026 - will savings actually reach businesses and consumers, or will they evaporate in other fees?"
Dr Angel Zhong is an Associate Professor of Finance, specialising in global financial markets, behaviour and trends.
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