Australian consumers are facing questions about café pricing after new rules banning credit card surcharges took effect on 1 October 2026. Economists and consumer advocates say some businesses may be using the change as an opportunity to introduce price increases larger than the fees customers previously paid when using cards.

The surcharge ban was introduced following reforms led by the Reserve Bank of Australia, with the aim of making prices more transparent and reducing the additional costs customers face when paying electronically.

Before the change, businesses commonly applied a surcharge of about 1.5 per cent to card transactions. Under the new arrangements, customers should see the price they are expected to pay without a separate surcharge being added at checkout.

However, early data from Small Flat White, an online coffee-price tracker, suggests that some cafés have raised their advertised prices since the ban began. Its survey of more than 1,500 cafés found that 17 per cent had increased coffee prices. Among those businesses, the average increase was approximately 50 cents, or more than 10 per cent.

That increase is substantially greater than the typical 1.5 per cent card surcharge. Economists have suggested that broader business pressures, including inflation and resilient consumer demand, may help explain why some prices have risen by more than the former surcharge amount.

Café and restaurant operators also face higher costs for ingredients, rent, wages, equipment and financing. Industry representatives argue that many businesses have been absorbing these pressures for years and are now reviewing their prices.

The Australian Competition and Consumer Commission has warned businesses that they must not mislead customers by attributing an increase entirely to the surcharge ban when other factors have contributed to the change. Businesses also risk breaching consumer law if they attempt to circumvent the rules by relabelling a prohibited surcharge as another type of fee.

Consumer advocates say the central benefit of the reform is greater price transparency. Customers should be able to compare the advertised price of a product or service and understand what they will pay before reaching the checkout.

Nevertheless, the early figures do not prove that every café raising prices is doing so improperly. Businesses can legitimately change prices to reflect higher operating costs, provided they comply with consumer law and do not misrepresent the reasons for the increase.

For consumers, the practical advice is to check menu prices before ordering, compare nearby cafés and review the final amount charged. If a business appears to be applying a prohibited surcharge or making misleading claims about its pricing, customers can seek guidance from the relevant consumer-protection authority.

The effect of the new rules will become clearer as more pricing data becomes available. For now, the early figures show that the surcharge ban has not prevented some businesses from raising prices, although the reasons and effects differ from one café to another.

The broader debate is whether the reform will ultimately reduce payment costs for consumers or whether some businesses will absorb those costs through higher advertised prices.