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Questions  /  Least-cost routing

What is least-cost routing and should I turn it on?

Short answer

Least-cost routing (LCR) automatically sends a dual-network debit payment to whichever network — eftpos, Debit Mastercard or Visa Debit — costs you less to accept. Around 85% of Australian debit cards are dual-network, and the RBA says LCR can cut debit acceptance cost by about 20%. For debit-heavy businesses it is usually worth asking your provider to enable it, though actual savings depend on your mix and we cannot guarantee them.

Last updated: 2 July 2026

How least-cost routing works

Most Australian debit cards are dual-network: a single card can run over more than one network, such as eftpos as well as Debit Mastercard or Visa Debit. Around 85% of debit cards in Australia are dual-network. When a customer taps or inserts one of these, least-cost routing lets your payments system send the transaction down whichever network costs your business less to accept, rather than defaulting to a particular one. The customer experience is unchanged; the difference is purely in which network processes the payment behind the scenes.

Should you turn it on?

The RBA says least-cost routing can cut the cost of accepting debit by around 20%, so the more of your turnover that comes from debit cards, the more it tends to matter. For debit-heavy businesses — think cafés, takeaways and convenience stores where small-value taps dominate — it is usually worth asking your provider whether LCR is enabled and how it applies across in-person and online channels. Savings vary with your card mix and pricing, and we cannot guarantee them, but switching it on is a low-risk question to put to your provider. It also complements the 2026 interchange cuts: where those lower the wholesale debit cost, LCR helps ensure each transaction takes the cheaper path.

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Source: RBA Review of Merchant Card Payment Costs and Surcharging, Conclusions Paper (March 2026).

Information current as at 2 July 2026.

This page is general information only and is not legal or financial advice. The RBA sets the final rules and timing, so confirm current details at rba.gov.au.
Common questions
Related questions
What does least-cost routing do?
It automatically routes a dual-network debit transaction to whichever network costs your business less to accept. The customer’s experience is unchanged; only the processing network differs.
How much can least-cost routing save me?
The RBA says LCR can cut debit acceptance cost by around 20%. The actual saving depends on how much of your turnover is debit and on your pricing, so we cannot guarantee a specific figure.
Does least-cost routing work on every card?
It applies to dual-network debit cards, which make up around 85% of Australian debit cards. It does not change how single-network cards or credit cards are routed.
Should a small business turn on least-cost routing?
For debit-heavy businesses it is usually worth doing, because debit makes up much of their card volume. The practical step is to ask your provider whether LCR is enabled and whether it covers both in-person and online payments.
How do I enable least-cost routing?
It is set up through your payments provider, so the first step is to ask whether your account has LCR turned on and how it is configured. Some providers enable it by default while others require you to request it.
Keep reading
Will my merchant fees go down in 2026? →What is a good merchant rate in Australia? →What is the average merchant fee in Australia? →Do I stop paying merchant fees after the surcharge ban? →Will my fees change? →All questions →
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