Australian businesses typically pay around 1.5% to 2.2% for card payments through all-in-one providers, and less for direct debit or PayTo. As at October 2026, Stripe's standard rate is 1.65% + A$0.30 for domestic cards and 1% + A$0.30 (capped at A$3.50) for BECS Direct Debit and PayTo. Square charges 1.6% to 1.9% in person and 2.2% online. From 1 October 2026, under the Reserve Bank's reforms, businesses should no longer surcharge eftpos, Mastercard or Visa debit, prepaid and credit cards, and interchange caps on domestic cards are lower. Build fees into your prices instead.
Key takeaways
- From 1 October 2026, surcharging on eftpos, Mastercard and Visa cards (debit, prepaid and credit) should end. American Express isn't covered by this decision.
- Domestic interchange caps fall from 1 October 2026, with a foreign card cap and more transparency from 1 April 2027. Ask your provider whether savings will be passed on.
- For recurring payments, direct debit and PayTo are usually cheaper than cards, especially on larger amounts.
- Compare your effective rate: total fees divided by total payments, including failures, chargebacks and terminal costs.
- Annual plans cut per-transaction costs and failed payments. Price them so the discount is worth it.
In The Subscription Playbook I talk about the hidden costs that quietly eat a subscription's margin. Payment fees are near the top of the list. On a A$49 membership, a 1.9% card fee plus 30 cents is A$1.23 a month. Over 500 members that's more than A$7,000 a year.
Until recently, a lot of Australian businesses simply added a surcharge. From October 2026, for most cards, that option is gone. So the fee you pay and how you get paid now come straight out of your margin, unless you price for them.
This guide covers what businesses pay as at October 2026, what the Reserve Bank's changes mean, and how to bring your effective rate down. Fees change often, so always check your provider's current pricing page.
The surcharge ban: what changed on 1 October 2026
In March 2026, the RBA's Payments System Board published the conclusions of its review of merchant card payment costs and surcharging. The key decisions:
- Surcharging removed on designated networks. The RBA decided to remove surcharging by lifting its prohibition on "no-surcharge" rules for all designated card networks, which are eftpos, Mastercard and Visa, covering debit, prepaid and credit cards. It expects the networks to impose no-surcharge rules, and said it could recommend the Government legislate a ban if surcharging continues.
- Lower interchange caps on domestic cards. The consumer credit card cap falls from 0.8% to 0.3%, and the debit and prepaid cap is lowered; the commercial credit card cap stays at 0.8%.
- A cap on foreign card interchange and more cost transparency, including acquirers publishing their fees.
The RBA's media release says most changes, including the removal of surcharging and reductions in domestic interchange caps, take effect on 1 October 2026. The foreign card cap and some transparency changes start on 1 April 2027.
American Express isn't a designated network, so it isn't covered by this decision. The RBA said Amex issues would be looked at in a further review. Check your network agreements before you surcharge any card.
What it means for your prices
- Remove card surcharges from your checkout, invoices and price lists for eftpos, Mastercard and Visa.
- Build your expected payment costs into your headline price. The RBA's intent is that payment costs are built into prices rather than added as a surcharge.
- If you need to raise prices, do it openly. My guide to price increase rules in Australia covers how.
- Ask your provider whether, and when, lower interchange will flow into your rate. On a "blended" flat rate, it won't automatically.
What Australian businesses pay: typical published rates
These are standard published rates as at October 2026. Many providers negotiate lower rates for higher volumes.
| Provider and method | Published rate |
|---|---|
| Stripe, domestic cards | 1.65% + A$0.30 |
| Stripe, international cards | 3.5% + A$0.30 (plus 2% if currency conversion is needed) |
| Stripe, BECS Direct Debit | 1% + A$0.30, capped at A$3.50 |
| Stripe, PayTo | 1% + A$0.30, capped at A$3.50 |
| Stripe Billing (pay as you go) | 0.7% of billing volume, on top of payment fees |
| Square, in person (Register, Terminal) | 1.6% |
| Square, in person (Reader, Stand) | 1.9% |
| Square, online, invoices and keyed-in | 2.2% |
Stripe says its card and PayTo/BECS fees include GST; Square's pricing page doesn't say. Stripe also flags lower international card pricing from 1 April 2027. Dedicated direct debit providers popular with gyms, clinics and trades, such as Ezidebit, Debitsuccess and GoCardless, publish their own per-transaction, setup and dishonour fees. Bank merchant facilities are usually quoted individually.
What each method costs on a A$49 and a A$490 payment
| Method | Fee on A$49 | % of A$49 | Fee on A$490 | % of A$490 |
|---|---|---|---|---|
| Stripe domestic card (1.65% + 30c) | A$1.11 | 2.3% | A$8.39 | 1.7% |
| Square online (2.2%) | A$1.08 | 2.2% | A$10.78 | 2.2% |
| Stripe BECS or PayTo (1% + 30c, cap A$3.50) | A$0.79 | 1.6% | A$3.50 | 0.7% |
Two lessons from that table:
- The fixed 30 cents hurts small payments. On low-priced monthly plans, a percentage-only rate can be cheaper.
- Capped bank payments win on big amounts. For annual plans and larger retainers, direct debit or PayTo can cost a fraction of a card.
Your real cost: the effective rate
The published rate isn't what you pay. Your effective rate is:
total payment costs in a month ÷ total payments received
Include everything: transaction fees, failed payment and dishonour fees, chargeback fees, terminal rental, monthly platform fees and billing add-ons. Most owners who do this sum for the first time find their real rate is noticeably higher than the headline.
Do it every quarter. It's a ten-minute job with your provider's monthly statement.
Reworking your prices after the surcharge ban?
A BPAG adviser can look at your margins and payment mix in a free 30-minute profit review.
Six ways to cut your payment costs
- Move recurring customers to direct debit or PayTo. Offer it as the default for memberships and plans. Bank accounts don't expire, so you'll usually see fewer failed payments too. Read the direct debit rules first.
- Offer annual plans. One transaction instead of twelve, and one chance of failure instead of twelve. Check the discount with the annual discount calculator.
- Negotiate. Once you're processing meaningful volume, ask for interchange-plus pricing or a lower blended rate, and ask how the October 2026 interchange cuts will be passed through.
- Use least-cost routing for in-person debit card payments, where your provider supports it, so dual-network cards can be routed through the cheaper network.
- Reduce failed payments. Card updater services, smart retries and reminder emails cut dishonour fees and lost revenue. See involuntary churn.
- Watch international cards. If many customers pay with overseas cards, the fee difference is large. The foreign card interchange cap from 1 April 2027 should help, depending on your provider.
GST on payment fees
Whether your fees include GST depends on the provider. Stripe says its Australian card and PayTo/BECS fees include GST. If you're registered and hold a tax invoice, you can generally claim the GST as a credit. Download your monthly fee statements. See GST on subscriptions.
Your checklist after October 2026
- Remove surcharges on eftpos, Mastercard and Visa from every channel.
- Calculate your effective payment rate for the last three months.
- Decide your default payment method for recurring customers.
- Re-price, if needed, with the fee built in, and give proper notice.
- Ask your provider for its interchange pass-through and new pricing.
- Review again after 1 April 2027 when the foreign card cap starts.
Free Subscription Profit Review
Australian business owners can book a free 30-minute review with a BPAG Accountants adviser. An honest conversation about:
- whether a subscription model could work for your business
- how recurring revenue could cover your fixed costs each month
- how it could lift what your business is worth
No cost, no obligation. General information only until we understand your situation.
Frequently asked questions
Is card surcharging banned in Australia?
From 1 October 2026, the Reserve Bank's reforms remove surcharging on eftpos, Mastercard and Visa cards, including debit, prepaid and credit. The RBA lifted its prohibition on the card networks' no-surcharge rules and expects the networks to apply them. American Express is not a designated network and isn't covered by this decision.
What are Stripe's fees in Australia?
As at October 2026, Stripe's published Australian rates are 1.65% + A$0.30 for domestic cards, 3.5% + A$0.30 for international cards (plus 2% for currency conversion), and 1% + A$0.30 capped at A$3.50 for BECS Direct Debit and PayTo. Check Stripe's pricing page for current rates.
What is the cheapest way to take recurring payments in Australia?
For most businesses, bank-account payments such as BECS direct debit or PayTo are cheaper than cards, particularly for larger amounts where fees are capped. Annual billing also reduces per-transaction costs. Compare total costs including dishonour fees.
Can I still surcharge American Express?
The RBA's March 2026 decision applies to designated networks (eftpos, Mastercard and Visa). American Express isn't designated, and the RBA said Amex would be considered in a further review. Any surcharge must still not be misleading and should reflect your cost. Check your agreements and current guidance.
Will my merchant fees go down after October 2026?
Lower interchange caps reduce the wholesale cost of card payments, and the RBA expects acquirers to pass savings on. If you pay a blended flat rate, savings may not flow through automatically. Ask your provider, and compare your effective rate before and after.
General information only, current as at 29 October 2026. It isn't legal, tax or financial advice and doesn't consider your circumstances. Speak to a qualified adviser before acting.
Talk it through with a BPAG adviser
Free for Australian business owners: a 30-minute Subscription Profit Review on whether a subscription suits your business.
Robert Coorey, MBA
Robert is the author of The Subscription Playbook and Feed a Starving Crowd and a Director at BPAG Accountants in Sydney. More about Robert.
Sources and further reading
- Reserve Bank of Australia, Review of Merchant Card Payment Costs and Surcharging: Conclusions Paper (March 2026)
- Reserve Bank of Australia, Conclusions Paper executive summary
- Reserve Bank of Australia, Media release 2026-10
- ANZ, Australia card surcharge ban 2026 (business guide)
- Stripe, Pricing (Australia)
- Square, Pricing (Australia)
- GoCardless, BECS Direct Debit (Australia)
Sources checked 29 October 2026. Spotted something out of date? Tell us.