Getting hit with a surcharge for paying by card is annoying enough, but not being told about it upfront is even more frustrating. Disappointingly, this seems to be mostly the norm, as research from consumer group Choice found.
The results of their nationally representative survey showed 66 per cent of people reported being slugged with a card surcharge without being informed first.
The survey comes amid heightened scrutiny of card surcharges, with the government instructing the Reserve Bank of Australia (RBA) to conduct a review of card surcharges ahead of possibly banning the practice entirely in 2026.
Tom Abourizk, head of policy at Choice, says his group welcomes the government’s proposal and will campaign strongly to make sure it happens.
“Extra, needless expenses are the last thing people need during a cost-of-living crisis,” he says.
“Paying with your own money, whether it be by debit card or cash, should not come at a cost.
“A ban on debit card surcharges would provide consumers with one surprise-free way to pay, but all excessive surcharges need to be addressed.
The survey of more than 1000 consumers also found that 68 per cent of people didn’t expect to pay more when paying via debit card, showing a disconnect between what people expect and what the law allows.
The vast majority (88 per cent) of Aussies felt that businesses should be required to inform customers of the amount of a surcharge before sale and 83 per cent felt card surcharges in general were unfair.
“People should be able to trust that the price advertised is the price they’ll pay at the checkout,” Mr Abourizk says.
“Our research shows that surcharges often catch consumers off guard, and almost nine in ten Australians think that businesses should be required to disclose surcharge amounts.”
Tech improvements not passed on
Mr Abourizk says advances in payment technology have come along leaps and bounds, but the benefits are really only being experienced by the banks and large payment providers.
“Payments technology is always improving, but the benefits are not being felt by consumers or small businesses,” he says.
“The simple act of paying for a product or service seems to be getting more complicated, and more costly.
Choice argues card surcharges are becoming increasingly common at the same time that ATMs and bank branches are disappearing, making it harder to access cash and forcing people to accept them.
Existing rules need to be enforced
Of course, there are existing rules and regulations surrounding excessive or unreasonable card surcharges, by Choice says they’re not being enforced.
They’re calling on state and territory regulators, as well as the Australian Competition and Consumer Commission, to make a committed effort to monitoring existing laws surrounding excessive surcharges, imposing a surcharge where no free payment option exists, and failing to be transparent about surcharges more stringently.
Choice says it will be making a submission to the RBA’s card surcharge review as frustrations with card surcharge fees have become one of the most common issues raised by its members.
“With modern technology, it doesn’t make sense for any kind of card payment, for any value, to cost consumers or businesses extra dollars,” says Mr Abourizk.
Would you support a total ban on card surcharges? Should you at least be informed of them up front? Let us know in the comments section below.
