Where Your $5 Coffee Payment Actually Goes (And How to Fix It)

You tap your card. The barista makes your coffee. Simple transaction, right? Not quite. Here's what actually happens behind that tap. The Journey of Your $5 When you pay $5 for a coffee using your Visa or Mastercard: Your bank (the issuer) authorizes the transaction and collects an interchange fee (0.3-0.8%) Visa or Mastercard routes the transaction and collects a scheme fee (~0.05%) The cafe's bank (the acquirer) processes the payment and takes a margin The payment processor (like Tyro, Square, or Stripe) takes their cut The terminal provider charges a rental or per-transaction fee By the time the cafe gets paid, 2-3 business days later, they've lost roughly $0.015-$0.04 of your $5. Doesn't sound like much? Across all of Australia's card payments, that's $1.6 billion a year going to intermediaries. The Surcharge Ban Doesn't Fix This Australia's RBA just banned card surcharges (effective October 2026). Consumers won't see that 1.5% line item anymore. But the 0.3-0.8% processing cost pe