Card Surcharges Are Ending in 2026: What Every Family Business Needs to Know
- Future Accounting
- 11 minutes ago
- 4 min read
Written by: Chris Mulcahy
Introduction: Card Surcharges Are Ending
For years, many Australian businesses have recovered merchant fees by applying a surcharge to card payments.
From 1 October 2026, that changes.
Under reforms announced by the Reserve Bank of Australia, businesses will no longer be permitted to apply surcharges to EFTPOS, Visa or Mastercard transactions.
At first glance, the change may not seem significant. After all, what's one or two percent?
But for many family businesses, this isn't really about card surcharges.
It's about profitability.
It's about understanding the true cost of doing business.
And it's about ensuring your pricing reflects reality.
The End of Card Surcharges
Currently, many businesses pass merchant fees directly onto customers through a surcharge at the point of sale.
After 1 October 2026, those fees will become a cost that must be absorbed by the business.
For some businesses, the impact may be relatively minor.
For others, particularly those with high transaction volumes and tight margins, the effect could be significant.
The question is not whether the law is changing.
The question is whether your business is ready.
The Real Cost Isn't What You Think
Many business owners immediately focus on the merchant fee.
"We'll lose 1%."
"We'll lose 1.5%."
"We'll lose the surcharge."
But that's often the wrong way to think about it.
The real issue is that most family businesses already operate in an environment where costs are constantly increasing:
Wages
Superannuation
Insurance
Software subscriptions
Utilities
Fuel
Professional services
Compliance costs
The removal of card surcharges simply adds another cost to that list.
The danger is not the merchant fee itself.
The danger is allowing another cost increase to quietly erode profit margins.
A Simple Example
Let's assume a business generates:
Annual revenue: $2,000,000
Card transactions: 80%
Merchant fee: 1.2%
Annual merchant fee cost:
$2,000,000 × 80% × 1.2% = $19,200
Many business owners look at $19,200 and conclude:
"We'll just absorb it."
But let's take a closer look.
If that business generates a net profit of $120,000, absorbing an additional $19,200 cost reduces profit to: $100,800
That's a reduction of approximately 16%.
Not because sales fell.
Not because productivity declined.
Not because staff costs increased.
Simply because a cost that was previously recovered is now being absorbed.
The Question Every Business Owner Should Ask
When was the last time you reviewed your pricing?
Not adjusted one product.
Not increased one service fee.
Reviewed your entire pricing structure.
Many family businesses continue charging prices established years ago while costs continue to increase.
The result is predictable:
Revenue grows.
Workload grows.
Stress grows.
Profit doesn't.
Pricing Is Not About Greed
Many business owners are uncomfortable increasing prices.
Particularly family businesses that have spent years building relationships with loyal customers.
However, pricing is not about greed.
Pricing is about sustainability.
A business that consistently undercharges eventually reaches a point where it cannot:
Invest in staff
Upgrade equipment
Improve systems
Reward owners
Fund growth
Create succession opportunities
Ultimately, underpricing threatens the long-term future of the business.
Four Questions Every Family Business Should Be Asking Now
1. How Much Are We Currently Recovering Through Surcharges?
Many business owners don't actually know.
Review your merchant statements and determine:
Total surcharge income received
Total merchant fees paid
Understanding the numbers is the first step.
2. What Percentage of Customers Pay by Card?
Consumer payment behaviour continues to evolve.
Many businesses now receive the majority of payments electronically.
The higher the percentage of card payments, the greater the impact of the surcharge changes.
3. Have We Reviewed Our Merchant Fees?
Not all providers charge the same rates.
Before increasing prices, review:
Current merchant rates
Transaction fees
Equipment fees
Alternative providers
You may be able to reduce costs before they impact profitability.
4. Does Our Pricing Reflect Today's Costs?
This is the most important question.
If you were starting your business today, would you charge the same prices?
If the answer is no, your pricing structure may already require attention.
Don't Wait Until October 2026
One mistake many businesses will make is waiting until the law changes.
The smarter approach is to review pricing well in advance.
Gradual, planned pricing adjustments are often better received by customers than a sudden increase when the deadline arrives.
The businesses that manage this transition best will not be the ones scrambling to react in September 2026.
They will be the businesses that start planning now.
Control the Controllable
Family businesses cannot control:
Interest rates
Inflation
Government policy
Payment regulations
But they can control:
Pricing
Margins
Cost management
Productivity
Profitability
The end of card surcharges is simply another reminder that successful businesses regularly review the factors they can influence.
Final Thoughts
The card surcharge ban is not a pricing problem.
It's a profitability conversation.
The businesses that thrive over the next decade will not be those that absorb every new cost increase.
They will be the businesses that understand their numbers, review pricing regularly and protect their margins.
Because preserving family wealth, protecting the future of the business and creating opportunities for the next generation all start with one thing:
A profitable business.
Unsure how the card surcharge changes will affect your business?
Future Accounting can help you review your pricing, assess the impact on profitability and identify practical strategies to protect your margins before the new rules commence.
Contact our team to arrange a business profitability review.
Disclaimer
This article does not constitute financial advice and is for general information only. It does not take into account any individual’s personal objectives, situation or needs, and is not intended as professional advice. Any similarity to an individual’s personal circumstances and the examples provided in this article is purely coincidental. Any person acting upon such information without receiving specific advice, does so entirely at their own risk.
Authorisation under an Australian Financial Services Licence (AFSL) is not required in the provision of this article and the author plus Future Accounting Group Pty Ltd is not acting in its capacity as an Australian Financial Services Licence holder
Liability limited by a scheme approved under professional standards legislation.
