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As Australia's showdown on surcharging heats up, the country's competition watchdog has vowed to pursue firms that engage in "misleading" surcharging practices that take advantage of consumers.

Last week, the head of the Australian Competition and Consumer Commission (ACCC)  that surcharging compliance and enforcement will be one of the agency’s key priorities in 2025-26.

Speaking at the Committee for Economic Development Australia (CEDA), ACCC chair Gina Cass-Gottlieb said the agency has been allocated A$2.1m ($1.3m) in new funding to tackle “excessive” surcharging.

“In the year ahead, our work will focus on increasing business compliance with the excessive card payment surcharging prohibition, and improving pricing practices to ensure all add-on costs are appropriately disclosed,” she said.

“We will also continue to contribute to the Reserve Bank of Australia’s (RBA) current policy considerations on solutions to support consumers and businesses while ensuring effective competition in the payments system.”

As covered by ���ĺ�������, the meaning of “excessive” in the context of Australia’s surcharging framework has become a key part of the debate.

As per the , an excessive surcharge is defined as one that charges the consumer over and above the merchant’s cost of acceptance.

In 2016, the Australian parliament passed new amendments to the Competition and Consumer Act 2010, giving the ACCC investigation and enforcement powers over cases of excessive surcharging.

These amendments allow the ACCC to issue infringement and penalty notices to firms that it considers are surcharging in excess of permitted levels.

In her speech, Cass-Gottlieb noted that the ACCC has worked closely with the RBA for “many years” to take action against merchants that abuse the freedom to surcharge.

By the end of 2018, the ACCC had pursued enforcement actions against five businesses in relation to excessive surcharging.

These included , the multinational gym chain, which was issued a fine of A$12,600 (US$8,000).

They also included car rental brand , which in 2019 was ordered to pay A$350,000 (US$222,000) for excessive surcharging, which was the largest penalty of its kind to date.

Lack of enforcement a key challenge for surcharging framework

Despite the ACCC’s efforts, one of the most common criticisms of Australia’s surcharging framework is that it suffers from a lack of consistent enforcement.

Many of the key players in the country’s payments market, including , the largest issuer and largest acquirer, pointed this out in their to the RBA’s latest review of the framework.

As covered by ���ĺ�������, many in Australia’s payments market would support a blanket ban on surcharging, and there is even greater support for a ban on debit surcharging.

The main exceptions to this consensus are among non-bank acquirers, such as Block, Worldline and Stripe, whose fixed-rate pricing plans have come under criticism for concealing merchants’ true cost of acceptance, and thereby helping to drive surcharging.

In October 2024, the Albanese government announced its intention to ban debit surcharging from January 2026 onwards, subject to parliamentary approval.

The idea was marketed as a cost-of-living intervention — a way to protect consumers who are already suffering from inflation while also getting “slugged” by surcharges, as the Prime Minister’s office put it.

In the meantime, the government said it would support the RBA’s review of surcharging and other retail payments issues, including scheme fees and interchange fees, and would commit additional funds to the ACCC to tackle excessive surcharging.

Submissions to the review closed in December and were published on the RBA website at the end of January 2025.

The central bank will publish its response to the submissions by the end of February.