ACCC Takes Action on High Card Surcharges in Response to Growing Complaints

The Australian Competition and Consumer Commission (ACCC) has cautioned businesses that excessive card surcharges will no longer be tolerated, following an increase in public complaints.

“From coffee to groceries, consumers are feeling the impact of inflated fees added to everyday purchases,” stated ACCC Chief Gina Cass-Gottlieb, announcing a stronger emphasis on enforcement.

Cass-Gottlieb revealed that the ACCC has received numerous complaints about card payment surcharges, with businesses potentially overcharging customers.

“Our efforts will concentrate on increasing business compliance with the prohibition on excessive card payment surcharges and enhancing pricing practices to ensure all additional costs are properly disclosed,” she mentioned at an economic development committee in Sydney on Feb. 20.

Penalties for Non-Compliance

Cass-Gottlieb clearly stated that businesses could face substantial fines, including fines of $50,000 for overcharging consumers.

While small businesses, such as local cafes, may not face legal action, they could still receive infringement notices with fines as high as $30,000 or $50,000.

In addition to fines, the ACCC may publicly name and shame businesses that persist in overcharging.

“We have a range of possible interventions, starting with good education,” Cass-Gottlieb said.

Government Response and Increased Funding

This comes as the government allocated an additional $2.1 million in funding to the ACCC in October 2024 to target excessive surcharges, as part of a broader effort to alleviate cost-of-living pressures.

Treasurer Jim Chalmers emphasized that this initiative aims to reduce hidden costs for consumers and small businesses.

“This is all about getting a better deal for consumers, reducing costs for small businesses, and promoting a more competitive payment system,” he stated.

Assistant Treasurer Stephen Jones echoed this sentiment, saying, “The surcharges pile up and punch a big hole in the wallets of customers and the earnings of small business owners.”

The proposed ban on debit card surcharges could be implemented by January 2026, aligning with the Reserve Bank of Australia’s examination of merchant payment costs.

ACCC Outlines its 2025-2026 Priorities

Looking forward, the ACCC plans to tackle deceptive pricing practices in supermarkets and aviation sectors, both of which have faced scrutiny over escalating prices and competition concerns.

A report from the commission’s supermarket inquiry is expected to be submitted by the government by the end of February.

Ms. Cass-Gottlieb mentioned that consumers remain uneasy about deceptive “was-now” pricing, which often creates the false impression of discounts.

Meanwhile, the commission recently recommended approving an alliance between Virgin Australia and Qatar Airways, citing a lack of competition in the aviation sector as a critical concern.

It will also investigate deceptive practices in retail and essential services like energy and telecommunications, as well as unfair contract terms, such as detrimental cancellation policies and automatic renewals, that disadvantage consumers and small businesses.

The regulator will concentrate on consumer safety in the digital economy, addressing misleading advertising, unsafe products, and subscription traps.

AAP contributed to this article