Australia’s ban on debit and credit card surcharges takes effect on Thursday, aiming to save consumers more than $1 billion, according to the Reserve Bank of Australia. Retailers will have to absorb payment processing costs or include them in displayed prices, so shoppers may not see savings if businesses raise prices.

Some businesses may instead offer discounts for cash or services such as PayID, though handling cash brings extra work for retailers. Card payments account for 73 per cent of counter purchases, while cash makes up about 15 per cent. The RBA is also lowering the maximum interchange fee from 0.80 to 0.30 per cent; experts say small businesses should check whether payment providers pass on those reductions. Banks may offset lost revenue by reducing card rewards or raising annual fees.