Expert predicts Aussies to ditch card surcharges and embrace digital transactions in 2025
- Replies 8
The Australian payment landscape is on the cusp of significant transformation, with emerging technologies and regulatory changes poised to reshape how consumers and businesses handle financial transactions.
As the digital payments ecosystem continues to evolve, experts are predicting a series of innovations that could fundamentally alter the way Australians interact with money, from shopping experiences to bill payments.
These potential shifts promise to streamline transactions, reduce fees, and introduce more convenient payment methods that align with global financial trends.
As we look towards 2025, experts are forecasting a landscape where card surcharges become a thing of the past, direct debits get a digital facelift, and the way we pay for everyday items undergoes a transformation.
Ben Zyl, CEO of digital wallet company Waave, has outlined a series of predictions that hinge on the actions of the government, the Reserve Bank of Australia (RBA), and major corporations.
One of the most anticipated changes is the proposed ban on debit card surcharges, which could come into effect by 2026.
This move is expected to eliminate the extra fees consumers pay when using their debit cards, putting money back into the pockets of Australian shoppers.
‘We will see a ban on surcharging for debit cards, but it will take an additional 12 months to come into play,’ Mr Zyl forecasted, but adding, ‘the surcharging problem is likely to remain unchanged’ due to limitations from the RBA.
‘The RBA as yet does not have the power to limit interchange fees…and has no visibility on card scheme fees.’
In contrast to some nations where surcharge bans cover both debit and credit cards, Australia's proposed ban is limited in scope.
Zyl argued this narrower approach is ‘leaving the door open’ for businesses to impose ‘blanket “card fees” to cover all bases’.
According to RMIT University Associate Professor of Finance Angel Zhong, the impact of these changes will be uneven, with small businesses likely to bear a disproportionate burden while larger enterprises can strategically adjust to maintain their profit margins.
‘In Australia, there’s a significant disparity between the fees paid by large and small merchants. In fact, RBA data shows small businesses pay fees about three times higher than what larger businesses pay,’ she wrote for The Conversation.
‘Banning surcharges on these could potentially lead to merchants increasing their base prices to cover these costs.’
‘The absence of surcharges could also reduce the competitive pressure on card networks to keep their fees in check, potentially leading to higher costs in the long run,’ Associate Professor Zhong added.
On the flip side, the rise of PayTo, a digital alternative to direct debits, is predicted to gain traction among ‘major billers like energy companies’, according to Mr Zyl.
‘In 2025, PayTo will switch from a “wait and see” for merchants to a must-have on their payments road maps,’ he stated.
‘PayTo will find its niche across enterprise retail and major billers like energy companies. These are the businesses that have the capacity to introduce it at scale and provide a clear consumer proposition like no surcharges on big-ticket transactions.’
Mr Zyl added that it will offer a ‘one-click user experience for paying bills while making life easier on the back-end for merchants’.
‘Once these dominoes fall, it’s only a matter of time before smaller retailers also jump onboard, but they will want to see it out there first,’ he continued.
Another area set for change is account-to-account payments, such as ‘Pay by Bank’, which bypasses intermediaries like cards.
This method is already ‘virtually mainstream across Europe’ and is expected to become more familiar to Australian consumers.
‘As account-to-account payments in areas like bill payments increase, consumer awareness about the ease and security of Pay by Bank will grow,’ Mr Zyl said.
‘2025 will be a pivotal year for providers to demonstrate how this works and why it should be standard across any checkout.’
Furthermore, the RBA's Payments System Board Annual Report indicates that all payments currently processed through the legacy Bulk Electronic Clearing System (BECS) will migrate to the New Payments Platform (NPP) by 2030.
This transition is set to modernise the way pensions, welfare, salaries, and dividends are paid.
The industry established a broad timeline for implementation with the understanding that ‘significant disruption to BECS could cause serious economic harm to end users’ and that ‘the significant changes required to facilitate decommissioning have the potential to heighten risks across the payments system’.
Lastly, the concept of self-serve payments, exemplified by Woolworths' ‘Scan and Go’ trolleys, is expected to gain popularity.
‘Consumers will just connect their account and be debited after packing their bags,’ Mr Zyl pointed out.
However, he anticipated that widespread adoption would not occur in the immediate future.
‘It will take years before we see this idea introduced across smaller businesses, but the big end of town is focused on building payments into the journey through a store without the need to pull out a wallet or phone,’ he added.
Members of the Seniors Discount Club, we'd love to hear your thoughts on these upcoming payment changes. How do you feel about the potential ban on card surcharges? Are you excited about the prospect of more digital payment options? Share your opinions and experiences with us in the comments below, and let's navigate the future of payments together.
As the digital payments ecosystem continues to evolve, experts are predicting a series of innovations that could fundamentally alter the way Australians interact with money, from shopping experiences to bill payments.
These potential shifts promise to streamline transactions, reduce fees, and introduce more convenient payment methods that align with global financial trends.
As we look towards 2025, experts are forecasting a landscape where card surcharges become a thing of the past, direct debits get a digital facelift, and the way we pay for everyday items undergoes a transformation.
Ben Zyl, CEO of digital wallet company Waave, has outlined a series of predictions that hinge on the actions of the government, the Reserve Bank of Australia (RBA), and major corporations.
One of the most anticipated changes is the proposed ban on debit card surcharges, which could come into effect by 2026.
Waave CEO Ben Zyl predicted multiple payment changes amidst a shift to digital transactions in Australia. Credit: Shutterstock
This move is expected to eliminate the extra fees consumers pay when using their debit cards, putting money back into the pockets of Australian shoppers.
‘We will see a ban on surcharging for debit cards, but it will take an additional 12 months to come into play,’ Mr Zyl forecasted, but adding, ‘the surcharging problem is likely to remain unchanged’ due to limitations from the RBA.
‘The RBA as yet does not have the power to limit interchange fees…and has no visibility on card scheme fees.’
In contrast to some nations where surcharge bans cover both debit and credit cards, Australia's proposed ban is limited in scope.
Zyl argued this narrower approach is ‘leaving the door open’ for businesses to impose ‘blanket “card fees” to cover all bases’.
According to RMIT University Associate Professor of Finance Angel Zhong, the impact of these changes will be uneven, with small businesses likely to bear a disproportionate burden while larger enterprises can strategically adjust to maintain their profit margins.
‘In Australia, there’s a significant disparity between the fees paid by large and small merchants. In fact, RBA data shows small businesses pay fees about three times higher than what larger businesses pay,’ she wrote for The Conversation.
‘Banning surcharges on these could potentially lead to merchants increasing their base prices to cover these costs.’
‘The absence of surcharges could also reduce the competitive pressure on card networks to keep their fees in check, potentially leading to higher costs in the long run,’ Associate Professor Zhong added.
On the flip side, the rise of PayTo, a digital alternative to direct debits, is predicted to gain traction among ‘major billers like energy companies’, according to Mr Zyl.
‘In 2025, PayTo will switch from a “wait and see” for merchants to a must-have on their payments road maps,’ he stated.
‘PayTo will find its niche across enterprise retail and major billers like energy companies. These are the businesses that have the capacity to introduce it at scale and provide a clear consumer proposition like no surcharges on big-ticket transactions.’
Mr Zyl added that it will offer a ‘one-click user experience for paying bills while making life easier on the back-end for merchants’.
‘Once these dominoes fall, it’s only a matter of time before smaller retailers also jump onboard, but they will want to see it out there first,’ he continued.
Another area set for change is account-to-account payments, such as ‘Pay by Bank’, which bypasses intermediaries like cards.
This method is already ‘virtually mainstream across Europe’ and is expected to become more familiar to Australian consumers.
‘As account-to-account payments in areas like bill payments increase, consumer awareness about the ease and security of Pay by Bank will grow,’ Mr Zyl said.
‘2025 will be a pivotal year for providers to demonstrate how this works and why it should be standard across any checkout.’
Furthermore, the RBA's Payments System Board Annual Report indicates that all payments currently processed through the legacy Bulk Electronic Clearing System (BECS) will migrate to the New Payments Platform (NPP) by 2030.
This transition is set to modernise the way pensions, welfare, salaries, and dividends are paid.
The industry established a broad timeline for implementation with the understanding that ‘significant disruption to BECS could cause serious economic harm to end users’ and that ‘the significant changes required to facilitate decommissioning have the potential to heighten risks across the payments system’.
Lastly, the concept of self-serve payments, exemplified by Woolworths' ‘Scan and Go’ trolleys, is expected to gain popularity.
‘Consumers will just connect their account and be debited after packing their bags,’ Mr Zyl pointed out.
However, he anticipated that widespread adoption would not occur in the immediate future.
‘It will take years before we see this idea introduced across smaller businesses, but the big end of town is focused on building payments into the journey through a store without the need to pull out a wallet or phone,’ he added.
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