Credit Card Surcharges in Australia - Explained | Finder

Credit Card Surcharges

It's 2021 and we shouldn't still be stung for paying on credit. But when you do, here's what to expect.

Lady shopping online with credit card.

We’re reader-supported and may be paid when you visit links to partner sites. We don’t compare all products in the market, but we’re working on it!

When you pay with your credit card, some businesses will apply a surcharge to cover the cost for processing the payment. These surcharges are usually between 1% and 2% of the transaction amount. In 2016, an excessive surcharge ban was placed on all businesses to ensure that customers weren't paying more than what it cost to process the payment. You can use this guide to learn when these fees are charged, how much you can expect to pay and how to avoid credit card surcharges.

What is a credit card surcharge and when is it applied?

Surcharges are fees that merchants apply to your transactions, on top of the advertised purchase price, to help them cover the cost of accepting credit cards as a payment method.

For example, a cafe that accepts credit cards will be charged a fee by its bank for processing the payment of your latte. Depending on the card, this fee can range from 0.5% to 2% of the total transaction cost. Businesses can choose to offset the cost of this fee through their pricing, or by applying a surcharge.

Payments that attract a surcharge

While credit cards often attract a surcharge, businesses can choose to apply this fee to a range of different payment methods including:

  • American Express (credit card and prepaid)
  • Mastercard (credit card, debit card and prepaid)
  • Visa (credit card, debit card and prepaid)
  • Eftpos (debit and prepaid)

Some businesses also apply a fee for other payment options, such as BPAY or PayPal. For example, Virgin Australia applies a surcharge for any airfare you buy with a credit card, debit card or PayPal.

It’s important to note that any business that includes a surcharge must let customers know before they pay. If the only payment option available requires a surcharge, the surcharge should be included as part of the original quoted price rather than added afterwards.

Credit card surcharge reforms

The Australian government regulates most surcharges, including those for Visa, Mastercard and American Express companion cards. Over the past few years, the government has introduced a number of surcharge regulations to limit how much these fees can be. There have been two key surcharge reforms between 2013 and 2016.

How much is a credit card surcharge?

The cost of a surcharge will vary depending on the business and the type of card that you're using but Visa and Mastercard credit cards may attract surcharges of 1% to 1.5% and American Express credit cards may incur surcharges of 1.5% and 2%.

To give you an idea of surcharge costs and the impact of the surcharge reforms, you can compare the surcharges that applied before and after 1 September 2016 below.

Booking flights

Prior to the RBA flat-rate surcharge ban, airlines were renowned for charging exorbitant credit card booking fees. There was previously a flat rate per flight and per person, but on 1 September 2016, a percentage-based surcharge system was introduced across the four major Australian airlines.

You can compare the old and new credit card booking fees charged by Qantas, Virgin, Jetstar and Tiger Air below.

Credit card surcharges before 1 September 2016

AirlineBooking and service fee* – Domestic flightsBooking and service fee* – International flights
Virgin$7.70Between $10 and $30
Jetstar$8.50Between $8.50 and $12.50

*The booking and service is fee is charged per person, per flight booked.

Credit card surcharges after 1 September 2016

Qantasqantas logo

Bookings made in Australia (per ticket, per cardCredit card feesDebit card feesFee cap (per ticket, per card)
Australian Domestic and Trans-Tasman1.03%0.36%$11 ($22 for bookings on or after 18 December 2019)

Virgin Australiavirgin australia logo

Flight type Credit DebitFee cap
Domestic, trans-Tasman and international1.024%0.410%$11.00
International short and long haul0.996%0.422%$70.00

Jetstar Airways jetstar logo

Card type% charge
Debit Mastercard0.21%
Debit Visa0.21% (0.44% on or after 17 December 2019)

Tiger Airtigerair australia logo

Card type% charge
Mastercard Credit0.98%
Mastercard Debit0.36%
Visa Credit1.12%
Visa Debit0.57%
American Express1.12%

Paying for a taxi

The excessive surcharge ban doesn't apply to taxi services, as the industry is regulated by state and territory regulators. The surcharge applied when you use your credit card to pay for a taxi varies from state to state and can be as much as 10% of your fare price.

The good news is that authorities in Victoria, NSW, WA, SA and the ACT have limited taxi surcharges to no more than 5% of the fare price.

Credit card surcharges for in-store or online purchase

As of 1 September 2016, the surcharges you’ll pay for credit card purchases in-store or online will be limited to the cost of accepting each payment method. In general, this will be between 1% and 3% of the total transaction cost.

Brick-and-mortar or online store that apply a credit card surcharge should clearly notify you before you make payment. For example, there should be signs at the checkout in-store or information on the website to notify you of any surcharges before you pay.

Other places you may have to pay surcharges

  • Ticket machines. You could have to pay a surcharge when you use your card to pay for parking at a ticket machine.
  • Events. Paying for event or concert tickets might require that you pay a surcharge. It’s important to note that surcharge regulations do not affect the “booking fees” that are applied regardless of the payment method used. The ACCC says there are no regulations to stop merchants from applying these fees, but they still need to be included in the advertised total price before a purchase is made in order to comply with Australian Consumer Law.
  • Utilities. Payments towards utilities and other bills can also attract surcharges.
  • Government payments. Payments to government bodies may also attract a credit card surcharge. For example, the Australian Taxation Office (ATO) applies a card fee based on the amount you pay and now says the fee will be based on the amount paid and the card used, and is “equal to the fee we incur from our banker”.
Back to top

How to avoid surcharges

While there are some instances where you have no option in paying a credit card surcharge, here are some ways you can avoid or reduce how much you pay in surcharges over time.

  • POLi. POLi, a wholly-owned subsidiary of Australia Post, is one of the country’s leading real-time, online payment methods. With Internet banking enabled on your credit card, you can choose to pay through POLi for airline tickets and more, and you don’t have to pay any surcharge when you use this payment method. POLi transactions from a credit card could also be considered “cash advance transactions” and may attract additional fees as a result. Check to make sure your card provider allows this payment option from a credit account.
  • Use a debit card. Under the latest surcharge laws, debit card payments will typically attract a lower fee than credit cards.
  • Consider other businesses. In some cases, you may be able to shop around to find a merchant that charges reduced or no credit card fees. For example, some taxi companies charge as much as 10% for credit card payments, while Uber doesn’t apply any credit card surcharge and even allows you to link your card through the app for faster payment.
  • Link your card to PayPal. You can link your credit card account to PayPal and then use your PayPal account to make payments if the merchant provides this option as a fee-free alternative.
  • Booking flights with points. When booking flights with Virgin Australia and Tiger Air, you can avoid surcharge fees by booking your flight with Velocity Points rather than cash.
  • Vouchers. Some airlines and institutions don't charge fees when you use a voucher to make the purchase or booking.

Frequently asked questions

The cost of a surcharge depends on the business, the cost of the transaction and the type of card you use. By taking note of when surcharges are applied, using alternative payment options or shopping around for a more affordable product or service, you can avoid paying or reduce the cost of credit card surcharges.

Images: Airline companies and Getty

Back to top

More guides on Finder

Ask an Expert

You are about to post a question on

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms of Use, Disclaimer & Privacy Policy and Privacy & Cookies Policy.

18 Responses

    Default Gravatar
    MichaelNovember 17, 2018

    Can I avoid fees if I buy an airline ticket using Bpay?

      Avatarfinder Customer Care
      JhezNovember 30, 2018Staff

      Hello Michael,

      Thank you for your comment.

      In some instances, paying via BPAY can allow you to avoid additional fees when booking flights. Kindly check the details and get ideas on how to minimise credit card booking fees for flights.

      Should you wish to have real-time answers to your questions, try our chatbox on the lower right corner of our page.


    Default Gravatar
    timochi89October 12, 2018


    This article advises that a fee-free payment option needs to be available. I have childcare fees where they charge a fee via all modes and only allow us to pay via Ezi-Debit (who is charging the fee). In your experience is there any way to avoid Ezi-Debit fees and/or should the child care be offering a surcharge free payment mode? They do not accept cash and advise this is the only way to pay (using Ezi-Debit)

      Avatarfinder Customer Care
      JoshuaOctober 17, 2018Staff

      Hi Timochi89,

      Thanks for getting in touch with Finder. I hope all is well with you. :)

      Ezidebit does charge a fee every time you use their service. There’s not much you can do about it if this is the only way you can pay for your childcare fee. Ezidebit passes the surcharge of your transaction to you to minimize their loss. Thankfully, the Australian government regulates most surcharges. If you feel like the charge is too much, then you may contact the ACCC on 1300 302 502.

      If it is possible, you may also ask your childcare fee recipient if they can offer other payment methods to lessen the burden on your part.

      I hope this helps. Should you have further questions, please don’t hesitate to reach us out again.

      Have a wonderful day!


    Default Gravatar
    JulieDecember 9, 2016

    Hi I paid my rent with my credit card at Peard estate agents they charged 2.5% extra I used a HSBC visa credit card are they allowed to do this with the new laws??

      Avatarfinder Customer Care
      MayDecember 9, 2016Staff

      Hi Michele,

      Thanks for your question.

      Usually, merchants that accept credit card payments apply surcharges to your transaction. Depending on the card you use and the type of transaction, surcharges range from 0.5% to 3% or more of the total transaction cost. Although this is allowed, merchants should only charge that is at “reasonable cost”.


    Default Gravatar
    MargaretSeptember 9, 2016

    I am wondering why do car sales still get to charge surcharge for credit card payments or will they be under the new laws too? An extra $1000 on a $40000 car seems unfair and a little rich at 2.5% surcharge…will they look into regulating the car industry as well?…. I was charged $19.53 for vehicle inspection when vic roads requires them by law to do this prior to registering any vehicle & $10 for online vic roads reg fee, I didn’t choose for them to do it online.

      Avatarfinder Customer Care
      ArraSeptember 21, 2016Staff

      Hi Margaret,

      I’m so sorry to hear that.

      The RBA’s 2016 surcharge reforms only intend to minimise excessive credit card surcharges, not eliminate the fees. Merchants applying a surcharge will now be using a percentage rather than a fixed dollar amount, which leads to more affordable surcharges, particularly for lower-value transactions. You might want to read more about the fixed-dollar ban through our RBA and surcharge guide.

      Also, if you think you have been excessively charged from the transactions you mentioned earlier, it would be best to discuss the matter directly with the provider of that product or service.

      I hope this has helped.


    Default Gravatar
    HamishMay 3, 2016

    if i pay for a new car on AMEX, what is considered a fair merchant card fee %?
    Visa I know will be around .8% on a 35K purchase.

      Avatarfinder Customer Care
      MayMay 4, 2016Staff

      Hi Hamish,

      Thanks for your inquiry.

      Apparently, American Express charges fees that are higher than Visa or MasterCard. As for AMEX Merchant Service fee, it’s subject to change at any time and it depends on the type of industry where the business belongs. You’d be best if you could directly inquire with AMEX the exact merchant service rate on car purchases. For your convenience, I’ve sent AMEX’s number to your email.


    Default Gravatar
    SamFebruary 25, 2016

    Is there a way to determine if you are using a credit card that will attract a premium surcharge?
    I understand that an Amex will attract one where a MasterCard or Visa will not, however if you have signed up to a premium credit card product with your bank such as Westpac Altitude Black, might the Black MasterCard be considered a premium card and attract similar surcharges to an Amex?

      Avatarfinder Customer Care
      JonathanFebruary 26, 2016Staff

      Hi Sam, thanks for your inquiry!

      There are no standardised surcharge fees with Westpac. Surcharges are administered by businesses. The senate is currently passing a bill to regulate credit card surcharges to ensure surcharges do not exceed 0.5% of the transaction.



    Default Gravatar
    PattyOctober 18, 2015

    Was charged by bank $103 for purchase of a Woolworth voucher worth $100 via PayPal. Who is charging the $3 since this is a local transaction? Bank, Woolworth or PayPal?


      Avatarfinder Customer Care
      JonathanOctober 19, 2015Staff

      Hi Patty, thanks for your inquiry!

      To investigate into the charges you have paid the transaction description on your bank statement can provide more information. A good place to start could be the Woolworths who is the merchant of your transaction.



    Default Gravatar
    carlaSeptember 1, 2015

    why was I charged $17 for a credit card fee with jetstar

      Avatarfinder Customer Care
      JonathanSeptember 1, 2015Staff

      Hi Carla, thanks for your inquiry!

      It is possible that the amount charged was a booking fee. It would be best to contact Jetstar directly to rectify this credit card fee. I have sent Jetstar’s contact details to your email.



    Default Gravatar
    KimJanuary 22, 2014

    If the expenses I incurred at the hotel is paid entirely by cash, is it correct to say the 1.5% surcharge does not apply? Thanks.

      Avatarfinder Customer Care
      ShirleyJanuary 22, 2014Staff

      Hi Kim,

      Thanks for your comment.

      Generally if you pay in cash there are no surcharges, however it is best to confirm this with the hotel staff.


Go to site