Local Sydney Businesses Forced To Raise Prices Amidst Card Surcharge Ban

A number of Sydney businesses have expressed concern over the recent card surcharge ban, noting they will likely have to raise prices or find other ways to pass the cost onto consumers.

It follows The Reserve Bank of Australia’s (RBA) decision to modify surcharge rules nation-wide “in the public interest”, modifications which subsequently allowed Visa, Mastercard, and Eftpos card networks to ban card surcharges from 1 October 2026. 

Crucially, while businesses can no longer charge customers for opting to pay by card under the new rules, businesses will still incur costs when accepting card payments, as the intermediaries of these card networks charge fees to process and secure each transaction.

Consequently, the ACCC had advised businesses that would like to recover the cost of accepting card payments do so by incorporating that cost into their overall pricing. For some businesses, however, raising prices is not that simple.

Local Businesses Speak Out Against Surcharge Ban

Bhavani Baumann, founder of the Chippendale Hotel’s Mama B’s, told CityHub that while they used to pass on a merchant fee of 1.54% to customers paying by card, they’ve since had to up the price of all their offerings.

“We have had to make small increases across the food and drinks menu,” said Baumann. “We simply would not survive the changes without increasing our prices. For us it would have been tens of thousands a year in lost revenue. It’s already hard to make a profit with everything else going up in price.

“It’s only been a few days but customers know they are worse off than before.”

According to the Darlinghurst Business Partnership (DBP), other businesses more fearful of raising their prices are entirely unsure what to do.

“We are still unsure as to what to do with these costs,” said a spokesperson for DBP. “We don’t know what kind of discount we’re getting from the banks, and as far as I know they haven’t announced anything. I haven’t been able to determine anything in my records yet, but it’s only been a few days.

“This is going to cost us thousands of dollars a year, and of course we will look for a way to pass that onto the customer, but it’s very difficult to raise prices in an economy like this.”

Additional reporting by Carelle Snounou.