The Reserve Bank of Australia has decided to ban surcharging on debit and credit cards from October 1, a decision that has been loudly criticised by agent representative bodies.
The Australian Travel Industry Association claims the move will shift costs onto travel businesses, potentially leading to higher prices for consumers.
Traveltalk asked some of Australia’s leading travel advisors for their thoughts.
Ben Apsey, Global Travel Co & Global Village Travel
From where we sit, this is a pretty poorly thought-through policy.
If the goal was to remove surcharging properly from the top down, including the banks and payment providers, that would make sense. That would actually deal with the problem. But this decision [by the RBA] doesn’t do that.
This just stops businesses at the end of the chain from passing on a cost we don’t control, while the banks and payment platforms still take their cut.
So the cost doesn’t go away. It just gets buried.
And we’re already seeing that play out. Qantas increased fares within an hour of the announcement. That’s not a coincidence. That’s the market adjusting straight away to protect margin.
For us, it fundamentally changes how those costs are handled. Instead of being applied to the clients who choose to pay by card, we now have to spread the cost of tens of thousands of dollars in card fees across all clients.
So now: clients not using card still pay for it, pricing becomes less transparent and overall costs go up
In travel, where transaction values are high and margins are tight, these aren’t small numbers.
The RBA and the Federal Government are trying to position this as helping with cost of living, but it’s just shifting the cost by pushing it into package pricing or worse it’s going to be at the expense of small business. Consumers still pay, they just don’t see it as clearly.
At the same time, access to cash is disappearing. Branches are closing and digital payments are the norm. So avoiding these costs isn’t really an option anymore.
From our side, this doesn’t reduce costs or inflation. It just redistributes it in a less transparent way and puts more pressure on small business.
The only part of the system that doesn’t really change is where those fees originate and who is making bank from them. The big end of town.
The travel industry will adapt, we always do, but this will just accelerate the move towards upfront pricing and service fees. Again, consumers end up paying.
It’s not removing the cost. It’s just moving it.
Robyn Sinfield, Home Travel Company
In my view, the RBA’s decision is fundamentally negative for the travel sector.
It removes a transparent cost mechanism without addressing the underlying reality that agents operate on already thin margins across most travel products.
The cost doesn’t disappear – it simply shifts, and in our case, it will inevitably be reflected in higher professional service fees.
The narrative that this benefits consumers is, frankly, misleading. Consumers will still pay – just less transparently.
Pricing across travel, as with most industries, will adjust to absorb these costs, meaning the real impact is a loss of clarity rather than a reduction in expense.
Travel is particularly exposed given the high transaction values we manage daily. As a result, I expect we’ll see behavioural change, with more clients encouraged toward direct bank transfers, potentially supported by incentives – not because it’s more convenient, but because the economics will demand it.
What remains uncertain, and critically important, is how suppliers respond. Airlines in particular will be a key watchpoint and there is little consistency at this stage around who will absorb costs versus pass them on.
This lack of alignment only adds further complexity for agencies and confusion for clients.
Overall, this is not a simplification of the system – it’s a redistribution of cost that adds pressure to an already constrained sector.
Peta Godfrey, Travel Focus Group
The upcoming RBA surcharge changes will affect every industry, not just travel, and while there is a lot of discussion around it, the reality is that businesses will simply need to adapt.
The travel industry has always been incredibly resilient and responsive to change, and this will be no different.
My advice to agency owners is not to waste energy stressing about what cannot be changed but instead focus on being prepared.
Stay across the updates from ATIA, review your payment and pricing structures early, and have a plan ready well before the changes commence in October.
ATIA is actively advocating for the industry and providing practical guidance, and as a member of ITAA, I’m also happy for advisors to reach out to me with concerns or feedback that can be raised directly with ATIA.
Naome Burdon of Argyle Travel and Cruise
The recent RBA surcharge changes are a disappointing result to the sustained advocacy efforts led by ATIA.
I agree with former comments, particularly remarks attributed to Dean Long of ATIA (“The RBA has based this decision on the belief that only 16% of businesses surcharge”).
Businesses such as supermarkets, pharmacies and other such retail outlets don’t ‘surcharge’ or benefit from a surcharge because all of their customers pay the bank fee, built into the retail price of their products.
While disappointing, we, the travel industry, remain an incredibly resilient group; we will continue to adapt and navigate around challenges faced.
The likely solution to this issue, will be that pricing will automatically assume payment via credit card and a reduced price will be available for ‘cash’ direct deposit payment.
An invaluable strength of our agency is the consistent support of our management team at Travellers Choice, who provide ongoing advocacy, strategic advice and guidance.
