How to absorb card fees without raising your prices

Once you can no longer surcharge covered cards, the fee lands on your business — but absorbing it doesn’t have to mean a price rise. The goal is to lower what cards actually cost you and to nudge your payment mix. It’s general information, not financial or legal advice, and savings can’t be guaranteed.

Step by step

1. Know your true cost of acceptanceWork out your cost of acceptance by dividing your total card fees by your total card turnover for a period. This tells you what cards genuinely cost you and where to focus. Without this number you’re guessing, so start here before changing anything.
2. Enable least-cost routing to cut debit costAround 85% of Australian debit cards are dual-network, and least-cost routing sends each transaction down the cheaper network. The RBA estimates this can reduce debit acceptance costs by roughly 20%. Ask your provider to confirm LCR is switched on across your terminals and online.
3. Compare and negotiate your rateBenchmark your blended rate against indicative figures — around 1.37% in-person and 1.78% online are indicative only, with small-business effective rates often falling between 1.1% and 2.5%. If yours sits high, ask your provider for a sharper rate or get competing quotes. Providers will often move to keep your business.
4. Trim fixed feesLook past the percentage rate at fixed costs like terminal rental and minimum monthly fees, which quietly add up. Question whether you need every terminal, and whether a lower-cost plan suits your volume. Cutting fixed fees lowers your effective cost without touching prices.
5. Consider a genuine cash or bank-transfer discountOffering a genuine discount for cash or bank transfer is still allowed and can shift some customers away from higher-cost card payments. Because it’s framed as a discount rather than a card surcharge, it stays clear of the ban. Make sure the everyday price is honest and the discount is real.
6. Review margin on low-ticket itemsFixed per-transaction costs hurt most on small sales, where a few cents of fee eats a bigger share of the price. Review the margin on your cheapest items and consider whether a minimum spend or product bundling helps. Small changes here can offset absorbed fees without a general price rise.
7. Monitor for interchange pass-through after 1 October 2026From 1 October 2026 interchange caps fall, but the merchant service fee itself isn’t capped, so the saving only reaches you if your provider passes it through. Check your statements after that date to see whether your effective rate drops. If it doesn’t, that’s a strong prompt to renegotiate or compare providers.

Source: RBA Review of Merchant Card Payment Costs and Surcharging — Conclusions Paper (March 2026).