Australia’s overhauled rules on credit and debit card surcharging took effect this week, and the Australian Chamber of Commerce and Industry (ACCI) has accused the government of a “staggering double standard” after the Australian Taxation Office (ATO) said it will stop accepting credit card payments from 30 November. The ABC reported on 1 October that some businesses are still unaware of the changes, while others are rewriting their price lists or hunting for workarounds. Amounts below are in Australian dollars, as reported.
Key facts
- Major reforms to how banks and businesses can bill and surcharge credit and debit transactions came into effect this week.
- The Reserve Bank of Australia, which set the reforms, says they should save customers about $1.6 billion a year and businesses $910 million a year through lower interchange fees.
- ACCI chief executive Andrew McKellar disputes that small businesses will save anything, telling the ABC there are “no real winners”.
- The ATO will stop accepting credit card payments from 30 November.
- The cap on credit card interchange fees has been cut, but merchants still face fees they can no longer pass on as a separate line.
- Sourcing note: every quote, figure and business example here comes from the ABC’s 1 October report. Fiji News has not independently verified them and has not obtained separate statements from the Reserve Bank, the ATO or ACCI.
What changed this week
According to the ABC, the reforms are sweeping, covering both the surcharges customers see at the till and the interchange fees banks collect from merchants behind it. Even with the lower interchange cap, the broadcaster reports, businesses are still paying fees to banks and payment providers that they may no longer recover as a separate surcharge — and are looking for other ways to recoup them.
Who polices the rules now
Enforcement also moved. The ABC reports that the Australian Competition and Consumer Commission policed the surcharging provisions of the Competition and Consumer Act 2010 until this week, and that the card networks and payment service providers now carry that job. For a customer, a disputed surcharge becomes a matter for the scheme and the merchant’s payment provider first, rather than a consumer-law regulator.
How businesses are responding
Salons
Salon owner Sheridan Shaw told the ABC she has been forced to raise her pricing, saying absorbing the cost would be “detrimental” to her business as it stands. The revised fees from banks and payment providers will now be factored into her prices, she said, even though she is conscious clients are already struggling financially. She ruled out steering customers to a PayID bank transfer, describing reconciliation and chasing failed payments as her “worst nightmare” for the client experience.
Australian Hairdressing Council chief executive Fiona Beamish told the ABC that hairdressers nationally are worried about raising prices and the risk of upsetting and losing clients. Her point was about the conversation operators must now have: clients were told surcharges were going away, and are instead meeting a higher base price, which puts the explaining on the salon rather than on the payment system.
Cafes and restaurants
Restaurant owner Peter Papas has also lifted prices and told the ABC he fears some customers will simply stop showing up once they can no longer pay. The ABC reported his example of taking a coffee from $4.80 to a flat $5.00 — about 4 per cent on that item, and a rise that falls on cash and card customers alike. Cash discounts were not an option, he said: “Offering cash discounts or banning certain credit cards is impractical and denies the consumer the flexibility of paying however they wish.” He pointed to the irony that cash customers are now helping fund credit card infrastructure providers, because everyone has adjusted their menus. Other businesses, the ABC reported, were exploring discounts for cash.
Consumers the broadcaster spoke to were split: one woman said the situation was “not great” because businesses feel they need to raise prices; a man said he does not notice the charges and doubted the change would alter his habits.
Housing and construction
Simon Croft of the Housing Industry Association, the residential building sector’s peak body, told the ABC the changes were likely to have flow-on effects for pricing on big projects such as housing construction. If manufacturers, suppliers and merchants can no longer recover processing costs through surcharges, he said, those costs risk being embedded in the underlying price of materials, products and services, adding pressure to affordability. Residential construction runs on fewer but far higher-value transactions, he noted, so even small payment fees add up — and because most direct payments in the sector are already fee-free bank transfers, his concern is upstream costs rather than charges at a counter. He argued the government should instead target the underlying cost of payments and of doing business, particularly for small firms.
The ATO ban and the fight over savings
McKellar reserved his strongest words for the tax office. He told the ABC the decision to stop taking credit cards was unacceptable and a staggering double standard that showed a complete lack of concern for what small businesses are going through. He also rejected the Reserve Bank’s savings claim, saying the costs remain and will either be absorbed by operators or passed to consumers.
The two headline claims are not a straight contradiction. The Reserve Bank’s numbers are economy-wide projections of lower interchange fees; McKellar is describing one merchant’s net position. Both can hold at once. The unresolved question — and this paragraph is Fiji News analysis, not ABC reporting — is who keeps the difference. If operators who lose the surcharge raise base prices, as Shaw and Papas said they have, part of the projected consumer saving is recycled into dearer menus and shelf prices, including for cash customers who never paid a surcharge in the first place. Until the modelling or an independent assessment is public, the $1.6 billion should be read as a forecast of fee reductions, not an observed saving at the till.
The ABC’s report does not set out the ATO’s reasoning for the 30 November change. Sole traders and small operators who settle tax bills by credit card should confirm an accepted alternative with the agency before the deadline, not on it.
Why it matters for Fijians in Australia
The change lands on ordinary bills — a haircut, a coffee, a tradesperson’s invoice. Unlike a surcharge, a higher base price is not itemised on the receipt and does not automatically disappear when the fee environment shifts again. Diaspora households sit on both sides of that counter, as customers and as owners or staff of the service businesses now repricing, though no Fiji-Australian operator is quoted in the reporting available and Fiji News is seeking that account for a follow-up.
For context rather than measurement: the Reserve Bank of Fiji publishes monthly inward personal remittance figures and names Australia among the main source countries, alongside New Zealand and the United States. Money that stays in Australia as a higher grocery, fuel or services bill is money not sent — but the series is aggregated monthly and will not isolate one payments reform, and remittance pricing itself, through transfer fees and exchange-rate margins, is untouched by these rules. It is one more line in a household budget already stretched by rising Gold Coast rents and the prospect of another Reserve Bank rate rise.
What to watch
Three tests from here. 30 November, when the ATO ban starts and operators find out what the alternatives cost them in cash-flow terms. The live November rate decision, which will move diaspora budgets far more than a coffee repriced by 20 cents. And the next few months of price lists: if base prices rise now and never come back down, the saving this reform promised consumers will be hard to find.
Frequently Asked Questions
Who enforces Australia’s card surcharging rules now?
The ABC reports that until this week the Australian Competition and Consumer Commission enforced the surcharging provisions of the Competition and Consumer Act 2010, and that from this week the card networks and payment service providers carry that responsibility. In practice a disputed surcharge becomes a matter for the card scheme and the merchant’s payment provider in the first instance rather than for a consumer-law regulator. The ABC’s report does not say the handover came with a new public complaints channel.
What happens on 30 November and what should card users do before then?
The ABC reports the Australian Taxation Office will stop accepting credit card payments from 30 November. The report does not set out the ATO’s stated reasoning, and Fiji News has not verified which alternatives — debit card, BPAY or direct debit — will remain available, or whether a fee applies to them. Anyone who routinely settles a tax bill by credit card, including sole traders in the diaspora who use the card to manage timing on a quarterly liability, should confirm an accepted method with the ATO well before the date.
Why do the Reserve Bank’s savings figure and ACCI’s rebuttal both sound plausible?
Because they measure different things. The figure attributed to the Reserve Bank of Australia in the ABC’s report — about $1.6 billion a year for customers, plus $910 million for businesses — is an economy-wide annual estimate built on lower interchange fees. ACCI chief executive Andrew McKellar’s objection concerns the net position of an individual small business, which still pays bank and payment-provider fees it can no longer itemise. Aggregate fee revenue can fall while one operator’s costs stay flat or rise, depending on the card mix its customers use.
Does the reform change what it costs to send money home to Fiji?
There is no evidence that it does. The reforms cover domestic card surcharging and the interchange fees Australian banks charge Australian merchants. Remittances to Fiji are priced separately, through transfer fees and exchange-rate margins set by money transfer operators and banks, which the reported changes do not touch. Fiji News has seen no reporting or official statement pointing to any effect on remittance pricing.
Why don’t businesses simply ask customers to pay by bank transfer?
Salon owner Sheridan Shaw told the ABC a PayID bank transfer is not workable for her business, citing the reconciliation load and the need to chase customers over failed payments, which she called her “worst nightmare” for the client experience. Sector matters too: the Housing Industry Association’s Simon Croft told the ABC most direct payments in residential construction are already made by bank transfer and avoid fees, which is why his concern is costs embedded upstream in materials and supply rather than charges at a till.
What has Fiji News not been able to verify in this story?
Four things. The Reserve Bank’s modelling behind the $1.6 billion and $910 million estimates, including whether it anticipates merchants lifting base prices. The ATO’s stated reasons for ending credit card payments and which alternatives are fee-free. How widespread the price rises are — the ABC cites individual businesses, not a survey. And any Fiji-specific measure of exposure, including how many diaspora-owned small businesses are affected; no Fiji-Australian operator is quoted in the reporting this article draws on, and Fiji News is seeking that interview for a follow-up.
