Credit Cards, Rewards and BNPL Rules — 2026-10-08

Top developments

Australia Enforces Ban on Visa, Mastercard, and Eftpos Surcharges

Effective October 1, 2026, Australian businesses can no longer add surcharges to payments made using Visa, Mastercard, American Express, and eftpos cards, regardless of whether they are debit, prepaid, or credit. This regulatory change, driven by the Reserve Bank of Australia (RBA), aims to reduce consumer costs but has immediately impacted business pricing models. Retailers and service providers are now grappling with how to absorb the interchange fees previously passed on to customers, leading to broader price adjustments in the retail sector.

Banks Slash Rewards and Hike Fees to Offset Interchange Losses

In response to the surcharge ban and lower interchange caps, Australian banks have begun cutting credit card rewards programs and increasing annual fees. The RBA’s reforms have reduced the revenue banks earn from transaction fees, forcing them to rebalance their card economics by devaluing points and raising costs for cardholders. Major issuers are revising their loyalty tiers, with many premium cards seeing reduced lounge access or higher spending thresholds to maintain elite status benefits.

Japan’s dCard Announces Reward Rate Cut to 0.5% Starting 2027

Japanese telecom-affiliated card issuer dCard confirmed that its standard reward rate will drop to 0.5% starting in 2027, a significant reduction from previous terms. The change also introduces conditional annual fees for certain card tiers that were previously free or low-cost. This move reflects a broader trend among Japanese card issuers to tighten profitability amid rising operational costs and changing consumer payment habits, impacting millions of users who rely on the card for daily transactions.

Chase and IHG Refresh Co-Branded Cards with Higher Fees

Chase and InterContinental Hotels Group (IHG) launched a refreshed lineup of credit cards in early October 2026, introducing a new "Premier Select" tier and updating benefits on existing cards. While new perks include enhanced earning rates and elite status matches, several cards saw increased annual fees, signaling a shift toward value-driven but costlier premium products. The changes require cardholders to re-evaluate whether the new benefits justify the higher cost, particularly for frequent travelers who may find lounge access and free night awards less flexible than in prior versions.

October 2026 Interchange and Network Updates Go Live

Visa, Mastercard, Discover, and American Express implemented various interchange and network rule changes effective October 2026. These updates affect how merchants process transactions and may influence the availability of certain card benefits for consumers. The changes are part of ongoing network maintenance and compliance adjustments, requiring both issuers and acquirers to update their systems and terms.

Local view

Korea: Local media reports that major Korean card issuers have launched interest-free installment campaigns for October shopping and travel to stimulate spending amid economic uncertainty. These promotions offer up to six months of interest-free payments, aiming to reduce the burden of holiday and travel expenses for consumers.

Japan: Japanese financial blogs and news outlets are closely monitoring the "kaaku" (worsening) of card benefits, with dCard’s announcement dominating discussions. Consumers are advised to review their card usage patterns and consider switching to cards with more stable reward structures before the 2027 changes take effect.

Context & numbers

• Surcharge Ban Date: October 1, 2026, marks the official start of the ban on surcharges for Visa, Mastercard, Amex, and Eftpos in Australia.
• dCard Reward Rate: The new base reward rate for dCard in Japan will be 0.5%, down from previous higher rates.
• IHG Card Fees: The refreshed Chase IHG cards feature increased annual fees, though specific amounts vary by tier; the new Premier Select card is positioned as a mid-tier option with updated benefits.
• Interchange Caps: The RBA’s reforms have lowered interchange caps, directly reducing the revenue banks receive per transaction, which is the primary driver behind recent rewards cuts.

On the radar

• November 2026: Luxury Card (Japan) will implement annual fee revisions starting January 2027, announced in October, as it marks its 10th anniversary in Japan.
• Q4 2026: Watch for further devaluations in airline and hotel transfer partners linked to major US bank cards, as issuers continue to balance their liability reserves.
• BNPL Regulations: Global regulators continue to refine BNPL rules, with the UK and EU focusing on affordability checks and credit reporting standards for Klarna, Affirm, and Afterpay.