top of page
Search

Cash Is King: Why Some Aussie Hospo Businesses Are Threatening to Ditch Cards

Tap and go might be convenient, but some Australian hospitality businesses are saying they’d rather go back to cash.


And it’s not because they suddenly hate technology.

It’s because of fees.


From 1 October 2026, Australian businesses will no longer be able to charge customers a surcharge for payments made using EFTPOS, Visa and Mastercard under new Reserve Bank of Australia payment rules.

For customers, that sounds pretty good.


No more adding a 1.5% or 2% fee to your morning coffee just because you tapped your card.


But for cafes, restaurants, pubs and other hospitality businesses already dealing with rising wages, food costs, rent and energy bills, the change is creating a very different conversation.



Some businesses are considering going cash-only

Hospitality operators in South Australia have reportedly been considering a return to cash-only trading to avoid absorbing card-processing costs.


Some businesses have already made the switch.


And while "cash only" might sound like something from 2005, the financial reasoning is pretty simple:

If accepting a card costs the business money, and the business can no longer pass that cost on through a surcharge, the business has to find another way to protect its margin.


That could mean higher menu prices.

It could mean absorbing the cost.

Or, in some cases, it could mean saying:

"Cash, please."


But isn't the surcharge ban supposed to help small businesses too?

Yes, and this is where things get interesting.

The RBA isn't simply removing surcharges and leaving businesses with the entire bill.


The broader reforms also include reductions to interchange fee caps, which are designed to reduce the costs businesses pay to accept card payments.


The RBA estimates the reforms could save Australian consumers and businesses around $1.8 billion a year overall.


So, in theory, businesses should benefit from lower underlying payment costs.

The problem is that hospitality operators are questioning whether those savings will be enough to compensate for losing the ability to recover payment costs directly from customers.



And this isn't just about coffee


Think about a $200 restaurant bill.

A 1.5% card surcharge is $3.

For the customer, that's annoying.


For a business processing thousands of transactions, those small amounts can add up.


Now multiply that across every table, every day, every week.

Hospitality is already a notoriously tight-margin industry.

So operators aren't necessarily saying:

"We want customers to pay more."

They're saying:

"We can't keep absorbing every new cost."


So will cash actually make a comeback?


Possibly.

And that's the irony.


Australia has spent years moving towards a cashless economy. Tap-and-go payments have become almost second nature.


But if businesses feel that accepting digital payments is becoming too expensive, some may actively encourage customers to bring back the wallet.


And that creates an interesting question:

Did we really become a cashless economy or did we just become a cashless economy when cash was convenient for businesses too?



What does this mean for customers?



Don't be surprised if you start seeing more businesses encouraging:

💵 Cash payments

🏦 Bank transfers

📱 Lower-cost payment options

💳 Different pricing structures


Businesses can still offer discounts for cash or other payment methods; the ban is specifically about card surcharges, not preventing businesses from offering discounts.


And yes, some customers are going to hate it.

Because let's be honest, most of us don't walk around with cash anymore.


The bigger workplace/business lesson


This story isn't really about cash versus cards.

It's about who ultimately pays when the cost of doing business changes.


Businesses rarely have unlimited margins.

When one cost disappears from the customer's receipt, it doesn't necessarily disappear from the economy.


Sometimes it moves somewhere else.

Into menu prices.

Into wages.

Into profit margins.


Or, apparently, into a decision to put an "CASH ONLY" sign on the door.

Cash might just be making a comeback.



 
 
 

Comments

bottom of page