How surcharge-free payments work, why some businesses choose it, and what it means in a post-October 2026 environment.
Surcharge-free EFTPOS means customers pay no extra fee when they tap, swipe, or insert their card. The merchant absorbs the payment processing cost rather than passing it to customers as a surcharge. From 1 October 2026, the RBA's full surcharge ban makes surcharge-free the legal standard for all Australian merchants — surcharging on any card type will be prohibited.
| Standard surcharging | Surcharge-free | |
|---|---|---|
| Who pays EFTPOS cost | Customer (via surcharge) | Merchant (absorbed) |
| Customer experience | Extra fee at checkout | No extra charge |
| Receipt appearance | Surcharge line item added | Clean — no surcharge line |
| Legal from Oct 2026 | ✕ Prohibited | ✔ Required |
| Customer friction | Common complaint — card surcharges frustrate customers | None |
| Merchant impact | EFTPOS cost recovered from customer | EFTPOS cost is a direct business cost — rate matters |
The Reserve Bank of Australia confirmed in March 2026 that card surcharges will be fully banned from 1 October 2026. The ban applies to all card types — debit, prepaid, and credit — across eftpos, Mastercard, and Visa.
From that date, every merchant in Australia operates surcharge-free by law. Businesses that have been recovering EFTPOS costs via surcharging will absorb those fees directly.
The RBA reduced interchange fee caps simultaneously — partially offsetting the cost. Debit card interchange drops from 0.20% to 0.16%, and scheme fees are also reduced. Merchants with acquirer-agnostic providers pass through these lower underlying costs.
For businesses that choose a lower negotiated rate now — before October — the transition is straightforward. For businesses on published flat rates like Square's 1.6%, the full rate becomes a direct margin cost with no way to recover it from customers.
When surcharging is no longer an option, your transaction rate is the single most important variable in your payment costs. The difference between a 1.6% rate and a 1.3% rate on $150,000 monthly turnover is $5,400 per year — as a direct P&L line, not a recoverable customer charge.
It depends on your customer base and margins. Businesses in hospitality, retail, and consumer-facing industries often report that surcharge-free improves customer experience and reduces complaints at the point of sale. From October 2026, it's also the legal standard — so the question shifts to: what rate makes absorbing the cost sustainable for your margins? UrPay's negotiated rates from 1.3% make surcharge-free more cost-effective than comparable providers.
No. Surcharge-free is a configuration setting on your POS or payment terminal — not a hardware change. You remove the surcharge calculation from your terminal or POS software. UrPay's terminals support all payment configurations including surcharge-free, split billing, and pay-by-link.
The Reserve Bank of Australia confirmed in March 2026 that card payment surcharges will be fully banned from 1 October 2026. This is a complete prohibition applying to debit, prepaid, and credit cards across eftpos, Mastercard, and Visa. Merchants cannot add a surcharge to any card transaction from that date.
Not necessarily. If you negotiate a lower transaction rate to offset the cost of absorbing fees, your net cost may be similar or lower than your current surcharge-recovery model. UrPay's negotiated rates from 1.3% — combined with the RBA's simultaneous interchange fee reductions — can make the transition cost-neutral or better for eligible businesses.
Surcharge-free becomes mandatory for all Australian merchants from 1 October 2026. UrPay's negotiated rates from 1.3% — with no lock-in and no monthly fee — make absorbing EFTPOS costs into your margin straightforward. Get your exact rate in one business day.