Interchange fees: What are they and what do they cost?
Interchange fees are charged every time a business accepts a card payment.
Key takeaways
- Interchange fees are bank charges that businesses pay when they accept card payments.
- Debit cards and standard credit cards often incur lower fees than premium credit cards.
- From 1 October 2026, businesses can no longer add a surcharge to payments made with eftpos, Mastercard or Visa cards.
Interchange fees make up the bulk of that cost. From 1 October 2026, the Reserve Bank removed surcharging on debit, prepaid and credit cards on the eftpos, Mastercard and Visa networks, so businesses can no longer add these costs to your bill as a surcharge when you pay with those cards.
Here we take a look at what these fees are, how they're calculated and what the surcharging changes mean for you.
When is an interchange fee charged?
Interchange fees are the cost businesses have to pay when a customer uses their credit or debit card. These fees cover the banks' costs of moving the money from the customer's bank account to the business' bank account.
Businesses used to be able to pass this cost on as a surcharge. Since 1 October 2026, they can no longer surcharge payments made with eftpos, Mastercard or Visa cards.
How are interchange fees calculated?
Card networks like Visa and Mastercard set interchange fees, within caps set by the Reserve Bank. American Express works differently: it doesn't have interchange fees, but businesses pay it a merchant service fee. Each network has different fees for various transaction types. The fees are usually calculated through a flat rate and/or a percentage of the total cost.
For example, if you use a Visa debit card for a contactless payment of $15 or less, the interchange fee will be 5.5 cents. If the sales total is more than $15, it will be 0.22% of the total cost.
For a Mastercard debit card, you're looking at 0.044 cents for a transaction of $15 or less, or 0.11 cents for more than $15.
How much will an interchange fee cost me?
Since 1 October 2026, you shouldn't see interchange fees added to your bill as a surcharge when you pay with an eftpos, Mastercard or Visa card. Businesses still pay them, though, and may build their card payment costs into their prices.
The interchange fee a business pays depends on the type of transaction, the card used, and how much is spent.
Debit versus credit cards
For a standard card payment on a Visa debit card, you're probably looking at an interchange fee rate of 0.22%. If you spend $100, that's a 22 cent fee for the business. For Visa credit cards, the rates get a little bit more complex. You might be charged a rate of 0.237% when you pay for a taxi, but there's a higher rate of 0.275% at a supermarket.
With Mastercard, a standard transaction with a credit card will have a fee of 0.231%, a fee of 0.33% if you use contactless in a taxi, and 0.34% for contactless payments. Debit cards using Mastercard tend to use dollar rates: 0.66 cents for taxis, 0.44 cents for standard card transactions and 11 cents for online transactions.
Types of cards
The more premium your card is, the higher the interchange fee. For example, for a standard Visa credit card there's a fee of 0.231% per transaction; for a premium Visa credit card (like Visa Platinum), the interchange fee jumps up to 0.792%.
Mastercard charges 0.44 cents for a standard card, but 11 cents for a premium card.
Types of transactions
As mentioned above, the fees for credit cards can vary depending on what type of merchant is taking payment.
Card issuers also have types of merchants/businesses who get better rates. This can be based on the volume of transactions, growth thresholds and innovation requirements. Rates here can range from 1 cent to 11 cents.
Note: The below is for credit cards, and is correct as of April 2025.
| Interchange category (Places) | Visa | Mastercard |
|---|---|---|
| Government, Utilities & Insurance | 0.231% | 0.231% |
| Transit | 0.231% | 0.33% |
| Service station/petroleum | 0.253% | 0.33% |
| Interchange category (Card type) | Visa | Mastercard |
|---|---|---|
| Standard cards | 0.22% | From 0.22% |
| Premium cards | 0.748% | 0.33% - 0.88% |
| Super premium cards | 0.770% - 0.869% | 0.682% - 0.88% |
Tips to avoid card surcharges
- Check the card network. The surcharging ban covers debit, prepaid and credit cards on the eftpos, Mastercard and Visa networks. It doesn't cover other networks, such as American Express, so check before you pay with one of those cards.
- Use cash. Cash payments don't attract card fees. However, more and more merchants are turning away from accepting cash. Check specific retailers to see whether they accept cash payments.
More resources on Finder
Ask a question
4 Responses
More guides on Finder
-
Credit card debt consolidation
Here's how to combine credit card debt into one manageable debt, and hopefully get a lower interest rate (or no interest charges at all).
-
What is a cash advance?
A cash advance lets you borrow money using your credit card. But doing so comes with hefty fees and immediate interest charges.
-
The American Express Rewards Hub
SPONSORED: Learn how you can get rewarded when you spend with American Express, in both business and day-to-day life.
-
PayPal vs credit card payments. Which is safer?
While both offer security features to keep your money safe, is PayPal or a credit card better when you’re shopping online?
-
Credit card application tips
Learn how to apply for a credit card and increase your chances of approval with these 8 tips.
-
Using a credit card for gambling… is very expensive
Find out which credit cards you can and can't use for gambling transactions and how much it'll cost.
-
A guide to the debt collection process in Australia
If you have debt collectors contacting you about overdue accounts, find out what rights and options you have to work through this process in a way that’s reasonable for you.
-
Custom credit card options in Australia
As well as credit card companies that let you choose your design, there are stickers and covers that you can get to customise your card.
-
Visa vs Mastercard
Compare acceptance, security and extra perks to decide whether a Visa or Mastercard credit card is right for you.
very few merchants, (if any to my knowledge) charge varied fees according to the category of card used. If they don’t how do they legally work out what fee to charge without the risk of being accused of price gouging or excessive fees?
Hi Michael,
Thanks for your question.
There are regulations in place by the Reserve Bank of Australia – this means retailers can only charge customers for the ‘reasonable cost’ of accepting electronic payment.
For more information about credit card surcharges, please read and get more information about how much are the credit card surcharges, how to avoid these surcharges and some frequently asked questions.
Cheers,
Shirley
I don’t think that was the point that Michael was making: the article above suggests that merchants charge higher fees to customers with platinum cards than they do to customers with basic cards:
“This means that the upgrade in card, regardless of whether you asked for that card in the first place, is costing you more for every swipe.”
That’s simply not the case. I’ve never encountered a merchant anywhere in Australia who charges a different fee if you have a platinum card versus a standard credit card.
Although it is quite common for them to charge a higher fee for AMEX/Diners versus Mastercard/Visa.
So the reality is the reverse of what this article suggests: everyone’s paying more to fund these higher interchange fees, because it’s either factored into the price of the goods, meaning you’re subsidising platinum cards even if you pay cash, or — if there is a credit card surcharge applied to the customer — then the effect of the higher fees for platinum cards is averaged out amongst all credit card users who choose to pay the surcharge, even those with basic cards.
As a customer, I can’t see a reason why I wouldn’t take the platinum card.
Oh on the subject of: “this mean retailers can only charge customers for the ‘reasonable cost’ of accepting electronic payment.”
I see no evidence of this being enforced whatsoever. A 3% surcharge on AMEX transactions still seems to be pretty common in my experience, despite this being nowhere near the ‘reasonable cost’ of accepting that card.
Hi Matt,
Thanks for your comment.
While the interchange fees outlined in this article are charged by lenders, it’s up to individual retailers to pass on these additional charges. As you mentioned, this doesn’t always happen, as retailers may only have a surcharge in place for AMEX cards, etc.
There has also been a lot of talk around the ‘reasonable cost’ that retailers must cover, especially when it comes to things like airline fees and the high credit card surcharges consumers pay. This may change in the near future, but for now, the ‘reasonable cost’ wording is all we have to go by.
Thanks,
Elizabeth