Credit Cards Regulatory Framework
Overview
In line with its approach to regulation, since the early 2000s the Bank has introduced a number of reforms which have regulated limited elements of designated credit and debit card systems, with the aim of improving the efficiency of the Australian payments system and promoting competition in the provision of payment services.
In short, the current credit card regulations:
- cap credit card interchange fees to a weighted average of 0.50 per cent of transaction value, with a ceiling on individual interchange rates of 0.80 per cent
- remove restrictions so that merchants can pass on card acceptance costs to cardholders in the form of a surcharge
- remove restrictions that require merchants to accept the debit cards of a scheme if they accept that scheme's credit cards and vice versa (through written Undertakings by Mastercard and Visa)
- reduce barriers to entry through Access Regimes which help increase participation in payment systems.
Since the card payment reforms in the early 2000s, the Bank has periodically reviewed its retail payments regulations. The most recent Review of Merchant Card Payment Costs and Surcharging took place over 2024-26 and the Bank released a Conclusions Paper in March 2026 following an extensive public consultation process. The Bank amended its Standards, which implement the following changes:
- From 1 October 2026, interchange fees on consumer credit cards will be subject to a maximum cap at 0.30 per cent of transaction value, while interchange fees on commercial credit cards will be subject to a maximum cap of 0.80 per cent. The weighted-average benchmark will no longer apply.
- From 1 October 2026, designated credit card systems will no longer be prohibited from imposing ‘no-surcharge’ rules.
- From 1 October 2026, designated credit card systems will be required to publish information about their interchange and scheme fees on a quarterly basis.
- From 1 April 2027, interchange fees on foreign-issued credit cards will be subject to a maximum cap of 1.0 per cent of transaction value.
The Bank’s Payments System Board has determined that these regulatory actions would together best support the public interest in line with its responsibility to promote the efficiency and competitiveness of the payments system and control risk in the financial system.