Card Surcharging Ends on 1 October 2026: What Brokers Need to Do

From 1 October 2026, you will no longer be able to add a surcharge when a client pays a premium by card. If your practice currently passes card fees on to clients, you have until the end of September to change how you charge and how you recover the cost. This note explains what is changing, what it is likely to cost you, and the steps to take before the deadline.

What is changing

On 1 October 2026, eftpos, Mastercard and Visa will each introduce "no-surcharge" rules. They are able to do this because the Reserve Bank has removed the rule that previously stopped them, under Standard No. 3 of 2016, as varied in 2026. The practical effect is a ban. From that date, you will not be able to add a surcharge to a card payment on any of these networks.

• Covered by the change. eftpos, Mastercard and Visa, across debit, prepaid and credit cards. There is no split between debit and credit; both are caught from the same date. Payments between businesses are covered as well, so a commercial card used by a business client is treated no differently from a personal card.
• Covered, but by American Express's own choice. American Express has decided to remove surcharging from the same date. It is not regulated by the Reserve Bank in the way the other three networks are, so this is a commercial decision rather than a rule imposed on it, and it is one American Express could revisit. Confirm the position with your acquirer or payment provider before 1 October.
• No position announced. Diners Club has not said publicly whether it will remove surcharging.
• Outside the change. Buy-now-pay-later, PayPal, BPAY, EFT and direct debit are not affected. The Reserve Bank does not currently regulate surcharges on non-card payments, although the usual rules about how you display prices still apply.

Do not count on an exemption. Whether one is available is a decision for each card network rather than for the Reserve Bank, and none has been announced for insurance.

Separately, the Reserve Bank is reviewing several areas it has not regulated before, including American Express and other three-party networks, buy-now-pay-later, and digital wallets. Written submissions to that review closed on 7 August 2026, and the Reserve Bank expects to publish its priorities by the end of the year. Nothing in that review changes what happens on 1 October.

What the interchange cuts will and will not do

The surcharging change does not arrive on its own. To reduce what businesses pay to accept cards, the Reserve Bank is also cutting the wholesale "interchange" fees that sit behind card acceptance. The cap on consumer credit cards falls from 0.80% to 0.30% on 1 October, and the caps on debit and prepaid cards fall as well. A new cap on foreign-issued cards starts on 1 April 2027. Taken together, the Reserve Bank estimates the package will reduce merchant card costs by around $910 million a year, with small businesses benefiting most because their fees sit closest to the caps.

There is one exception, and for brokers it may be the most important part of the package.

Commercial credit cards keep the 0.80% cap that consumer cards are leaving behind. If a large share of your premium comes from business clients paying on commercial cards, you will lose the surcharge without getting the interchange relief that is meant to offset it. American Express, which is not subject to interchange regulation at all, carries a large share of commercial card transactions in Australia. Work out your card mix before you assume the cuts will cover the gap.

What this means for you

For a broker, a card fee is not a cost of goods. It is the cost of collecting premium and government charges on someone else's behalf, and it comes out of what you retain rather than out of a margin on something you sell. Businesses generally add a fee of 1% to 2% to recover it. Losing the ability to charge that fee takes a real bite out of a broking margin, and how big a bite depends on how much of your premium arrives by card. That is worth working out now, while there is still time to do something about it.

What you need to do before 1 October 2026

Check your exposure

Work out how much premium you currently collect by card, split between consumer and commercial cards, and how much surcharge revenue you stand to lose.

Review your merchant agreement, paying particular attention to any "fee-free" plan that covers its own cost by automatically surcharging your clients. Plans of that kind will need to be repriced.

Fix your invoicing before the deadline

Look at any invoice you issue between now and 30 September that may not be paid until October. If the card payment is made on or after 1 October, surcharging may no longer be available even though you issued the invoice earlier. Some payment providers have indicated they may disable the functionality from that date.

Update everything that mentions a surcharge: invoices, payment pages, online checkouts, terminal prompts, and any client-facing fee disclosure.

Decide how you will recover the cost

Decide whether you will absorb card costs from 1 October or build them into your fee or brokerage. Read the trust-account section below before you settle on an approach.

Ask your acquirer whether they settle gross (they pass on the full amount and debit their fees separately) or net (they deduct their fee before the money reaches you). This matters more than it sounds, for the reasons set out below.

Reduce the cost where you can

You can still offer a discount to clients who pay by a cheaper method. The Reserve Bank has confirmed that discounting remains permitted, and with surcharging gone it becomes the compliant way to steer clients toward BPAY, EFT or direct debit.

Use the new fee-transparency information to push your acquirer or payment provider to pass on the lower interchange costs.

The trap to avoid

You cannot keep charging the same fee and simply give it a different name. The ACCC has been direct about this: "A business can't escape the ban by calling a card payment surcharge something else." A service fee or handling fee that applies only to clients who pay by particular methods is a card surcharge under another name, and a business that does it may be engaging in misleading conduct.

Two related points are worth understanding. First, the no-surcharge rules themselves are enforced by the card networks and payment providers rather than by the ACCC; the ACCC's interest is in misleading conduct. Second, you may lawfully raise your fees to cover the cost, but you must not mislead clients about your prices, and that includes the reasons you give for an increase. If you do introduce a fee, it needs to apply to all clients, not only to those who pay by card.

What this means for your trust account

Removing the surcharge changes your commercial arrangement. It does not change the client-money rules, and the two are easy to confuse, so it is worth being clear about the difference.

The rules themselves are unchanged. Premium your client pays is your client's money until it is remitted, and it is governed by the client-money provisions of the Corporations Act 2001: Division 2 of Part 7.8, in particular section 981B, together with regulation 7.8.02 of the Corporations Regulations 2001. What changes on 1 October is who bears the cost of collecting that money. Until then you can pass the card fee to the client. After that you cannot, so the merchant service fee becomes a cost of running your business, in the same way your terminal rental or your software subscription is.

The conservative course follows from that, and it is the one NIBA suggests you plan around: the full premium your client pays should reach your trust account, and the card cost should be met from your own funds rather than deducted from money that belongs to the client.

This is where gross and net settlement stops being a technicality. If your acquirer settles gross, the full premium lands in your account and their fees are debited separately, so nothing about your trust account changes. If your acquirer settles net, the fee is taken out before the money reaches you, which means less arrives than the client paid while you still owe the insurer the full amount. On a net arrangement you will need a process to make up that difference from your own funds, on the day, every time. Find out which arrangement you are on before 1 October. Many brokers will not know without asking.

Every practice collects and remits differently. Confirm with your own compliance and legal advisers how this applies to your business before you change the way you collect.

In short

Surcharging on eftpos, Mastercard, Visa and American Express ends on 1 October 2026. Between now and then, work out your exposure and your card mix, check any invoice you issue this month that may not be paid until October, review your merchant and payment arrangements, and decide how you will recover the cost without simply renaming the fee. The interchange cuts will help, but not on commercial cards, and only if they actually reach your own merchant fees. BPAY, EFT and direct debit are unaffected, and you can still offer a discount to steer clients toward them. Whatever you decide, make sure the full premium still reaches your trust account.

Questions? Contact the NIBA Policy Team at policy@niba.com.au.

More information: Reserve Bank of Australia, "Removal of payment surcharges from 1 October 2026"(frequently asked questions) and the Review of Merchant Card Payment Costs and Surcharging conclusions paper; ACCC, "Card surcharges".

This note is general information for insurance brokers and their teams. It does not take into account the circumstances of any individual practice, including your merchant agreement, how your acquirer settles, or the way your trust account operates. Obtain your own compliance and legal advice before you change how you collect premium or charge fees. Card network rules are set by the networks themselves and can change, so confirm the current position with your acquirer or payment service provider before relying on it. Information current as at 2 September 2026.