How to avoid credit card fees at the supermarket

What you could pay when you're shopping at supermarkets like Aldi, Coles and Woolworths – and how to keep costs down.

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While the biggest supermarket brands in Australia – Coles and Woolworths – don't have surcharges for using a credit card, you could pay cash advance rates and fees if you withdraw cash. Aldi, on the other hand, does have a credit card surcharge.

You can use this guide to understand when you might be charged a fee at the supermarket, how to avoid or reduce the cost and other ways to get more value from paying with a credit card.

What fees can apply when I use my credit card at the supermarket?

We’ve categorised the possible fees below to help you understand when you may be getting charged for buying groceries with plastic.


Some supermarkets charge customers a surcharge of between 0.5% or 2% of the transaction when they use a credit card. This surcharge covers the cost of processing the card transaction.

Major supermarkets such as Coles and Woolworths don't currently apply a surcharge to credit card payments. However, Aldi has a credit card surcharge of 0.5% when you pay with a Visa or Mastercard (it doesn't accept Amex). This surcharge also applies when you make a contactless payment with your debit card, as tap-and-go transactions are processed through the credit card network.

Supermarkets must inform customers of any surcharges at the checkout, so make sure to check if a fee applies before paying with a credit card. If it does, you might be better off paying with a debit card or cash to avoid additional surcharge costs.

Cash advances

If you use your credit card to withdraw cash at the supermarket checkout, you'll be charged a cash advance fee. This fee is typically around 3% of the transaction amount and is charged by your credit card provider, not Coles, Woolworths or any other supermarket that offers cash out.

You'll also be charged a cash advance interest rate which applies as soon as you make the transaction. Depending on your credit card, you may also be charged a cash advance fee for other "cash equivalent" transactions such as purchasing gift cards or reloading a prepaid card. So if you need to get cash out, consider using your debit card instead to avoid the high interest and fees.

4 ways to avoid or reduce credit card fees at the supermarket

  1. Use a debit card. Supermarkets are less likely to charge a fee if you pay with a debit card and, if they do, it will usually be lower than the cost of using a credit card. Just make sure you insert or swipe the card to avoid any extra cost that may apply to contactless payments.
  2. Use cash. Withdraw cash from your debit card for supermarkets that charge credit card fees (or any card fee). You can look at your past transactions to get an idea of how much you'll need. Or, ask to split the payment between cash and card if you don't quite have enough.
  3. Pay off your credit card quickly. If you use a credit card to get cash out or if you pay a surcharge, repaying what you've spent quickly will help you save on interest charges.
  4. Check for fees before shopping. Businesses have to display signs with details of any surcharges or other fees that apply to card payments. Look for these signs or ask a staff member before you start shopping. That gives you time to choose if you want to shop elsewhere or pay in a different way.

How can I get more value out of using my credit card at the supermarket?

On top of saving money on fees, you can also get more value at the supermarket if you have a rewards card. As long as you pay your balance in full every statement period, these credit cards could help reward your grocery shopping:

  • Supermarket credit cards. Examples of supermarket credit cards in Australia include Coles credit cards that earn flybuys points and Woolworths credit cards. Some of these supermarket cards are linked with the supermarket loyalty programs including Coles Flybuys and Everyday Rewards. These cards usually award more points per $1 spent at the supermarkets and come with perks to suit shoppers including discounts on your monthly shop.
  • Rewards credit cards. Rewards credit cards are linked with a bank loyalty program and typically earn points per $1 spent on purchases. You can redeem rewards including gift cards, merchandise or cashback on your credit card. Some rewards cards also allow you to convert your rewards points into frequent flyer points with their frequent flyer partners.
  • Frequent flyer credit cards. Frequent flyer credit cards are linked with an airline loyalty program and can also collect points per $1 spent. You can redeem your points for travel rewards including flights and upgrades, accommodation and travel packages. You can start comparing frequent flyer credit cards linked with Qantas or Velocity on Finder.

Compare supermarket credit cards

Name Product Bonus points Rewards program Rewards points per $ spent Purchase rate Annual fee
David Jones American Express Platinum Card
Membership Rewards
0% p.a. for 6 months, reverts to 20.74% p.a.
Earn 70,000 bonus Membership Rewards Points or 35,000 Qantas Points when you spend $1,500 outside DJ in the first 3 months. Ends 20 Oct 2021.
David Jones American Express Card
Membership Rewards
0% p.a. for 6 months, reverts to 20.74% p.a.
Get 50,000 bonus Membership Rewards Points or 25,000 Qantas Points when you spend $1,500 outside DJ in the first 3 months. Ends 20 Oct 2021.

Compare up to 4 providers

Using a credit card at the supermarket can be a useful way to manage your expenses and earn points, but there can be costs involved. Before you swipe your card, check if any surcharges or fee apply. If they do, you might want to pay with cash or credit cards instead.

Other guides you might want to read

Images: Getty

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5 Responses

    Default Gravatar
    mazAugust 19, 2015

    Hi Jonathan,
    Thanks for the speedy response. It’s a Visa card issued by Travelex.


    Default Gravatar
    mazAugust 18, 2015

    I am South African and visit my children and grandchildren in Australia. Initially I had a travel card which I could use to withdraw “cash out” at supermarkets, however when my new card was issued, now with a chip, I was unable to withdraw cash from the supermarkets, only at ATM’s. How can I get around this problem. Many thanks

      Avatarfinder Customer Care
      JonathanAugust 19, 2015Staff

      Hi Maz, thanks for your inquiry!

      The eligibility of using a travel card overseas depends on the card network e.g. AMEX, MasterCard, Visa etc. So I can assist you further could you please state which travel card you are using?



    Default Gravatar
    KimMay 7, 2015

    When making purchases (groceries) in germany, Italy, can cash be withdrawn at the same time when paying by travel cash card with Euros on it

      Avatarfinder Customer Care
      JonathanMay 7, 2015Staff

      Hi Kim,

      Thanks for your inquiry.

      Cash withdrawal facilities with purchases depend on the retailer’s policies and partnerships with banks/ATM facilities. You may like to refer to the following link for a guide on travel money in Germany.


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