One in five of us support ban of debit card surcharges

By PETER ROWE

One in five Australians say debit card surcharges are their most hated fee, according to a new survey by Money.com.au.

This comes as the federal government plans to ban surcharges on debit transactions by 2026.

And it’s Gen Z — despite being more familiar with cashless payments — who are most frustrated by card surcharges, with 25 per cent listing them as the fee they resent most. Following closely are Gen X (22 per cent), Millennials (20 per cent), and Boomers (19 per cent).

“Younger generations use debit cards more than any other payment method, so it makes sense that the fees associated with them would be a bigger issue for what they use most,” according to Peter Drennan, Money.com.au’s Research & Data Expert.

“At last count, the RBA found that 7.5 per cent of payments had a surcharge, but it has grown significantly since then,” he said.

“It’s likely much higher now as more and more retailers adopt surcharging. So, surcharges are more present and more of a concern than ever before.”

Second on the list of ‘grudge fees’ are credit card fees (18 per cent), including annual fees and foreign transaction fees.

Boomers were the most likely to list credit card fees as their top annoyance, followed by Gen X (18 per cent), Millennials (18 per cent), and Gen Z at 12 per cent.

Other commonly disliked fees include public holiday surcharges (15 per cent), ATM withdrawal fees (14 per cent), delivery fees for online shopping (11 per cent) and booking fees (9 per cent), like those charged for events or flights.

So is banning debit card fees a win for consumers or a blow to businesses?

The Federal government’s plan to ban debit card surcharges is still pending a review by the RBA, but it’s estimated it could save Australians up to $140 annually per cardholder.

Money.com.au’s Finance Expert, Sean Callery, says Aussies don’t want to be charged extra fees for the privilege of using their money.

“At a time when every dollar counts, it’s no surprise that card surcharges are pretty unpopular with consumers, finance expert Sean Callery said.

“With more businesses moving away from accepting cash, it’s becoming harder and harder to avoid these card surcharges altogether.”

However, reactions from businesses have been mixed. CEO of the Australian Restaurant and Café Association, Wes Lambert, says the ban could backfire on consumers.

“Consumers may be in for a shock if the government bans debit surcharges, as businesses will have no choice but to recover the cost of processing payments by raising their prices across the board,” he said.