Card surcharge ban forces small businesses to absorb payment costs
From 1 October, Australian businesses absorb card processing costs they previously charged customers.
The card surcharge ban started on 1 October. The visible fee disappeared, but the processing cost did not.
Jewellery shop owner Gagan now absorbs the expense that banks charge him for handling card payments. For now, Gagan absorbs the cost rather than raising prices.
But he admits it gets harder as time goes on. Cafe owner Rick Shishani faces even tighter margins.
Card payments make up about 90 per cent of his sales. Suppliers are adding fuel charges and other costs have risen.
This makes it hard to compete with nearby cafes without cutting profit. The Canberra Business Chamber opposed a blanket ban.
They said a better way was to reduce the underlying merchant fees. Assistant Minister Andrew Leigh said lower fees would ease the burden.
Businesses would respond in different ways.
- 1 October
- Ban effective date
- 90 per cent of transactions
- Card payments in Rick's cafe
- Gungahlin Marketplace
- Gagan's location
- Gungahlin
- Rick's location
Why it mattersSmall business owners must now choose between absorbing payment processing costs or raising prices for all customers, directly affecting both their survival and what consumers pay.
AustraliaAustralian small business owners are absorbing card processing fees immediately, with prices likely to rise over time as the cost becomes unsustainable.
✓ Claims checked against the source. checked 2 h ago
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