Card payment fees explained, a plain guide for Australian venues

Card fees are one of the largest controllable costs a venue carries, and most operators have never really understood what they are paying for. Here is how they work, what is changing in October 2026, and how to pay less.

Almost every venue in Australia accepts card payments, and almost none of them could tell you exactly what those payments cost or where the money goes. That is not a criticism, the system is deliberately opaque. But card fees are one of the biggest controllable costs a venue has, they rise every time you have a good week, and from October 2026 the rules around them change significantly. So it is worth understanding them properly. This guide breaks it all down in plain language, with no sales pitch.

What you are actually paying for

When a customer taps a card at your terminal, the fee you pay is not one charge, it is several stacked on top of each other. Understanding the parts is the first step to knowing whether you are paying too much.

• Interchange fee. This goes to the bank that issued your customer's card. It is set by the card networks and is usually the biggest single component.
• Scheme fee. This goes to Visa, Mastercard or eftpos for running the network the payment travels across.
• Your provider's margin. This is what your payment provider or bank adds on top for giving you the terminal and processing the payment. This is the part that varies most between providers, and the part you have the most power to change.

Added together, these make up your merchant service fee. For a typical venue it often lands somewhere between roughly 1 and 2 percent of each card sale, but the exact figure depends heavily on your provider, your volume and the mix of cards your customers use.

The big change coming in October 2026

This is the part every Australian operator needs to understand right now. The Reserve Bank has confirmed a package of reforms, and the headline one is this: from 1 October 2026, you will no longer be able to add a surcharge on eftpos, Mastercard or Visa payments. The fee does not disappear, it simply moves from the customer's receipt onto your margin, unless you plan for it.

Alongside the surcharge ban, the RBA is also lowering the interchange caps, which should reduce the underlying cost of accepting cards. For consumer credit cards the interchange cap drops, and debit caps come down too. The intention is that your base cost of accepting cards falls at the same time as your ability to pass on a surcharge ends, so for many venues the net impact is smaller than the full surcharge percentage. But, and this is the important catch, those interchange savings only reach you if your provider actually passes them through. Some will, some will quietly keep the difference. That alone is a reason to review what you are paying.

Least cost routing, the lever most venues miss

Here is one of the most useful and least understood tools available to you. Many debit cards in Australia can be processed over more than one network, and those networks charge different amounts. Least cost routing, sometimes called merchant choice routing, lets your terminal automatically send each tap down the cheapest available network. For a venue doing real volume, switching this on can meaningfully lower your effective rate without changing anything the customer sees.

The catch is that it is not always switched on by default, and not every provider offers it well. If you have never asked your provider whether least cost routing is enabled on your terminals, that is a five minute phone call that could quietly save you money on every eligible transaction.

How to pay less, practically

You have more control over card fees than most operators realise. A few concrete steps, in rough order of effort versus payoff.

• Find your real rate. Pull your last three months of merchant statements and work out what percentage of your card turnover you actually pay in fees. You cannot fix what you have not measured, and this one number tells you how exposed you are.
• Ask about least cost routing. Confirm it is switched on. If your provider cannot or will not enable it, that tells you something about the provider.
• Benchmark your provider. Rates vary a lot, and many venues are on a deal set years ago and never revisited. The reforms are increasing transparency precisely so businesses can compare, so use that. A provider that was competitive three years ago may not be now.
• Plan for the surcharge ban now, not in September. Decide whether you will absorb the fee or build it into your prices. A small, even adjustment across the menu is far less noticeable to customers than a surcharge line ever was, and planning early means no scramble before the deadline.
• Do not assume your bank is cheapest. Bank bundled EFTPOS is convenient but often carries higher and less transparent fees than specialist providers. It is the option most worth benchmarking.

A note on the numbers

You will see rates quoted everywhere from under 1 percent to well over 2 percent, and that range is real, it genuinely depends on your provider, your volume, your card mix and whether least cost routing is on. That is exactly why a generic rate quote means little and why looking at your own statements matters so much. The only rate that tells you anything useful is the one you are actually paying.

The bottom line

Card fees are a real, controllable cost, and the October 2026 reforms are forcing every venue to pay closer attention whether they like it or not. The operators who come out ahead will be the ones who spend an hour now understanding their real rate, switch on least cost routing, make sure they are on a fair deal, and plan calmly for the surcharge change. The ones who do nothing until the deadline will simply absorb a cost they could have reduced. A little attention now genuinely pays off.

This article is general information for Australian hospitality operators and is not financial advice. Details of the reforms are based on the Reserve Bank of Australia's confirmed changes effective 1 October 2026. Rates vary by business, so confirm specifics with your provider for your own situation.