An Aussie expat running over a dozen cafes in London has called on companies back home to take on the cost of card surcharges instead of passing them onto customers.
Urban Baristas co-founder Huw Wardrope said Australia is behind the ball in limiting card surcharges for customers after the European Union and UK banned them in early 2018.
The 44-year-old instead ‘wears the cost’ of card payments at his 15 locations and doubled down even against initial pushback from locals by going cashless.
‘I feel for cafes, especially cafes in the UK, I know it’s a difficult business but I think it’s time (for Australia) to get with the times,’ Mr Wardrope told the Daily Telegraph.
Urban Baristas has continued to grow even while paying fees for processing card payments and is opening four more ‘Aussie style’ cafes next year.
The businessman backed the Albanese government’s plan to crackdown on charges to merchants for customers paying with card.
Inserting a card to use Eftpos usually costs merchants less than 0.5 per cent of the sale, using contactless Visa and Mastercard payment can amount to 0.5 to 1 per cent each time for debit cards and one per cent to 1.5 per cent for credit cards.
Customers are often passed on the charge which is estimated to cost just under $1billion-a-year according to data from the Reserve Bank of Australia.
An Aussie expat who runs a flourishing cafe chain in London, Huw Wardrope (pictured), said companies back home should stop charging customers card surcharges
The government announced the plan to target surcharges on debit cards in October, but remains vague on tackling charges on credit cards.
Treasurer Jim Chalmers said the government was prepared to ban debit card surcharging from the start of 2026, pending further consultation with the RBA.
‘Consumers shouldn’t be punished for using cards or digital payments, and at the same time, small businesses shouldn’t have to pay hefty fees just to get paid themselves,’ he said.
‘We’re prepared to ban debit card surcharges, subject to further work by the Reserve Bank and safeguards to ensure small businesses and consumers can both benefit from lower costs.’
On a purchase of $100 the average cost added is 28c for EFTPOS, 52c for using the Mastercard network, 47c for using Visa and $1.88 for digital payments provider Square.
A small business owner described the financial bind they are in with digital payments in a Facebook post.
‘I run a small business we were using Square to take Eftpos last financial year, it cost us 40k in fees, we just can’t absorb the costs. Cash is king,’ they wrote.
Finder’s head of consumer research Graham Cooke said the long-term trends were away from using cash even if its cheaper.
The UK and European Union banned merchants from passing on the charges for card payments to customers in 2018 (stock image)
‘It does seem Aussies are choosing the convenience of plastic even though they have to pay these fees,’ he said.
The government wasn’t free from the fees either and was found to have illegally charged Aussies billions over two decades.
The issue came to light after the NSW government became aware that 92 million transactions had attracted $144million in illegal merchant fees since 2016.
Commonwealth laws prohibit the government from collecting payment surcharges when people pay a tax or fee, according to finance minister Katy Gallagher.
Ms Gallagher said in a statement the Albanese government would legislate to stop passing on debit surcharges from the ATO and Services Australia from January 1.
‘This new legislation will provide the finance minister with the power to quickly and efficiently amend Commonwealth surcharging policies, including to stop Commonwealth agencies passing on debit card surcharges,’ she said.
‘These Bills will not impose any new surcharges but fix the historical issue to ensure existing surcharges are authorised by legislation.’
