How the end of card surcharges could see Australian shoppers save with cash

Australian consumers could soon be paying less for everyday items as a “plot twist” emerges with the card surcharge ban.

Sold as a huge win for households, the Reserve Bank ended pesky surcharges placed on the end of purchases starting from October 1.

This is supposed to save households $1.6bn a year, although sceptics claim businesses will just increase the sticker price and actually cost households more.

But in a bizarre twist, Cash Welcome founder Jason Bryce told NewsWire physical tender would become more appealing to consumers as businesses could offer a discount for cash usage.

“This is big news and the Reserve Bank cannot be more explicit, a business can take off their card surcharge time and replace it with a cash discount sign,” he said.

“It is a bit of a plot twist because a cash discount or a card surcharge it is almost equivalent in a way, just the other side of the coin.”

As part of the Reserve Bank’s changes to card payments, businesses must display the entire cost of a product or service as the sticker price, including any transaction costs associated with card payments.

However, businesses will now be able to offer discounts for cash payments, below this sticker charge, if they decide not to pass on the surcharge cost to cash users.

Under its own frequently asked question section, the Reserve Bank confirms businesses can offer discounts for forms of payments that are not card transactions.

“Businesses that wish to steer consumers towards other payment methods can do so by providing discounts instead of using surcharges,” the RBA said.

Meanwhile the ACCC said businesses could offer discounts for payment methods such as cash or PayID.

“Payment method discounts should be clearly disclosed before consumers choose to book, order or pay,” their website stated.

“The price of any item that is displayed to consumers must be the full price they will pay if they do not receive the payment method discount.”

Mr Bryce forecasted more retailers would start offering cash discounts due to it becoming cost competitive compared with card payments.