Transactions on cards issued outside Australia now face a dedicated interchange cap, part of an RBA package aimed at lowering the cost of accepting card payments for local businesses.

What does it cost an Australian business when a visitor from abroad taps a card at the register? For most customers, the question never comes up. For merchants in tourist precincts, hotels, tour operators and online stores with international buyers, it can be a meaningful line in the monthly accounts.

The Reserve Bank of Australia has now addressed that corner of the payments system directly. Among the conclusions of its Review of Merchant Card Payment Costs and Surcharging, released in March 2026, the RBA introduced a new cap on interchange fees for foreign, or overseas-issued, card transactions. It sits alongside lower maximum interchange fees for consumer credit and debit card payments. Amended RBA standards took effect in April 2026.

For businesses with a large share of international customers, the foreign-card cap may be one of the more relevant parts of the package. (Specific cap levels are set out in the RBA's standards; this article does not reproduce them.)

A quick refresher on interchange

Interchange is a wholesale fee that sits inside most card payments. When a customer pays by card, the merchant's payment provider, known as the acquirer, pays an interchange fee to the bank that issued the card. The card scheme sets the fee schedule. The acquirer then recovers that cost, along with scheme fees and its own margin, through the merchant service fee it charges the business.

Because the merchant never sees interchange as a separate invoice, it can feel abstract. But it is often the largest single component of what a business pays to accept a card. Regulators focus on it because the business accepting the card has little ability to negotiate it directly: the customer chooses which card to use, and the issuing bank on the other side of the transaction may be anywhere in the world.

Why overseas cards were worth singling out

The word "new" in the RBA's description matters. It signals that foreign-card transactions are being brought under a cap of their own, rather than simply being swept along with the adjustments to domestic credit and debit caps.

As a general principle, transactions on overseas-issued cards have tended to cost merchants more to accept than domestic ones. Cross-border payments involve an issuer in another jurisdiction, and scheme pricing for them has typically reflected that. For a business whose customer base is largely local, this may barely register. For one where international visitors make up a large share of sales, it can shape the overall cost of accepting cards in a way that is hard to see or control.

A dedicated cap is intended to put a ceiling on that cost. The RBA's broader statement on the interchange changes is that the reductions "should help to lower card payment costs for businesses, especially small businesses". Many businesses that serve overseas visitors, from cafés near attractions to small accommodation providers and tour operators, fall squarely into that category.

Timing: the surcharge ban arrives tomorrow

The foreign-card cap is part of the same package that ends card surcharging. From Thursday 1 October 2026, surcharges on eftpos, Mastercard, Visa and American Express payments end, covering credit, debit and prepaid cards. About 16% of Australian businesses currently surcharge, and the RBA notes these businesses may choose to raise their sticker prices instead.

The two elements are designed to work together. When a business loses the ability to add a card surcharge, the underlying cost of accepting cards becomes something it must absorb or build into prices. Lowering and capping interchange, including on overseas cards, is meant to reduce the size of that cost in the first place.

Some charges remain permitted under the reforms: weekend surcharges, public holiday surcharges, and booking or service fees. Businesses can also offer discounts for particular payment methods. Taxi surcharging remains a matter for state and territory regulators. Businesses unsure how the changes apply to their own circumstances, including to international customers, may find the RBA's published FAQs a useful starting point.

Seeing the cost clearly

A cap only helps a merchant if the savings flow through, and whether they do depends partly on how the merchant is priced by its acquirer. Some businesses are on plans that break out costs by card type; others pay a single blended rate for all cards. Under a blended rate, a change in the cost of one category of card, such as overseas cards, may be hard to identify on the bill.

The reforms include transparency measures that are relevant here:

  • large acquirers must publish the fees they charge;
  • eftpos, Mastercard and Visa must disclose fee information;
  • merchant statements are to include standardised fee information.

For a business with significant foreign-card volumes, those disclosures may make it easier to see what it is paying on international transactions and to compare offers between providers.

The foreign-card cap is unlikely to make headlines at the checkout, but it may matter for particular kinds of businesses. Some questions they may be weighing:

  • Roughly what share of card sales come from overseas-issued cards?
  • Does the current merchant statement separate those transactions, or are they folded into one rate?
  • Has the business's effective cost of accepting cards changed since the amended standards took effect in April?
  • Does published acquirer fee information suggest the business's current plan is competitive?

For consumers, including international visitors, the practical difference is more modest. A visitor paying with a covered card on one of the named networks should no longer see a card surcharge from 1 October, though the reforms do not stop businesses from adjusting their listed prices.

The bottom line

The RBA's new interchange cap on overseas-issued cards gives international card transactions a cap of their own. It is a technical change, but for businesses that rely heavily on international customers it could affect the cost of every tap. Combined with lower domestic caps, the end of card surcharges and new fee transparency rules, it forms part of a package the RBA says should help lower payment costs, particularly for small businesses. How much any individual business benefits will depend on its customer mix and its pricing arrangements with its acquirer.