AUSTRALIA | The ACCC has encouraged businesses to review their card payment surcharges to ensure they are in line with their cost of accepting card payments.
Businesses should also ensure that they adequately disclose any card payment surcharges upfront, so that customers can make informed decisions before ordering, booking, and paying for a product or service.
Misleading surcharging practices and other add-on costs are a compliance and enforcement priority for the ACCC in the 2025-26 financial year.
“Businesses need to ensure their customers know about any card payment surcharges upfront, and that they are only charging what it costs them to accept those card payments,” said ACCC Deputy Chair Mick Keogh.
The Australian Consumer Law prohibits businesses from misleading people about the prices they charge.
The Competition and Consumer Act also prohibits businesses from charging a card payment surcharge that is excessive. A card payment surcharge is considered excessive if it is higher than the business’s ‘cost of acceptance’.
For example, suppose a business’s ‘cost of acceptance’ for Visa credit card payments, including the merchant service fee and all other permissible costs, is one percent, and they choose to charge a card payment surcharge. In that case, they can only apply a surcharge of up to 1 per cent to their customers who pay using a Visa credit card.
The ACCC has launched an education and compliance campaign to inform businesses, particularly small businesses, of their obligations and assist them in complying with relevant laws.
As part of this campaign, the ACCC is helping businesses to comply with the law through advertisements and updated guidance material. It will also be engaging closely with relevant industry representatives to help them support their small business members in complying with the laws.
The ACCC will also be actively monitoring business compliance and may take appropriate compliance or enforcement action, in line with our Compliance and Enforcement Policy.
“We understand that small businesses need to be across a lot of information to comply with all of the laws that apply to their business; however, charging excessive surcharges and not being upfront with customers about pricing can result in small businesses losing customers," Keogh added.
"Small businesses need to ensure they understand their obligations and check their costs of acceptance to know what amounts they can legally charge their customers as a payment surcharge, as well as reviewing how they inform customers of their prices, including any applicable surcharges.”
Businesses may also wish to seek advice from their bank or payment facilitator, an accountant or business advisor to assist them with working out what their ‘cost of acceptance’ is.
