The "card or cash" question at the end of a taxi ride is usually a muscle-memory decision rather than a real choice. Most travellers tap whatever is already in their hand. But the two options have different costs, different fraud risks, and different paper trails, and the difference adds up across a year of travel.
Here is the short version of what I'd actually recommend, and the caveats.
The basic difference
| Cash | Card | |
|---|---|---|
| Surcharge | None | 4% max (or 6% Cabcharge) |
| Receipt | Printed on request | Printed and on statement |
| Fraud risk | Driver can't clone cash | Card skimming possible |
| Expense trail | Receipt only | Card statement + receipt |
| Tipping flexibility | Easy to round up | Some terminals allow tip entry |
The 4 percent surcharge is the headline number. On an $82 CBD fare, that is $3.28. Roughly the price of a coffee at the airport.
When cash wins
Low friction, low fraud risk. Pay the exact fare, walk away. Nothing to dispute later. No card data exposed.
Cheaper by 4 percent. For a single airport run this is small ($3 to $4). For frequent travellers (20 trips a year), it becomes $60 to $80 annually. Real money.
Anonymous. No digital trail connecting your identity to the trip. Matters to a few travellers; irrelevant to most.
Useful backup if card terminals fail. The "EFTPOS is broken" scam works less well when the passenger has cash. If the driver says the machine is broken, you pay cash at the meter amount (no swipe-and-inflate possible), and the scam ends.
When card wins
You don't have Australian cash. The airport exchange kiosk charges its own fee — usually worse than the 4 percent card surcharge.
You need the statement entry for expense claims. Most corporate expense systems want to match the receipt against a card transaction. Cash receipts alone are sometimes questioned.
See your exact fare — enter your suburb
Fixed price, all tolls and GST included. No card required.
You want the paper trail for a dispute. If you're later billed incorrectly or suspect an overcharge, the card statement plus the printed receipt is the strongest evidence for a chargeback.
You're a foreign traveller with no AUD on hand. Your home-country card works in the Victorian EFTPOS system. You'll pay the 4 percent local surcharge plus your bank's international transaction fee, but it beats carrying cash you can't easily use elsewhere.
The fraud angle (card specifically)
Small number of Melbourne taxi drivers have been caught using modified NFC readers that copy card data from contactless (tap) transactions. Westpac has formally warned about this. The full detail is in the scams post.
The rule that avoids it: insert the chip and type your PIN. Don't tap. The chip-and-PIN transaction is tokenised differently and cannot be cloned the same way.
Apple Pay and Google Pay are also safe, because they use device-specific tokens rather than your real card number. If you want to tap, tap through your phone, not your plastic card.
The hybrid approach I actually use
My rule when I travel and am asked the question:
- Default to chip-and-PIN credit card for the paper trail and the dispute protection.
- Carry $50 in AUD cash as a backup, for the rare scenario where the card terminal genuinely fails or the driver is running a swipe-and-inflate scam.
- Never tap plastic at a taxi terminal.
That combination gives you the expense trail, the fraud protection, and an exit route if anything seems off. For most travellers it's the practical middle ground.
One specific Melbourne scenario
Late Friday night, pre-booked pickup, driver says EFTPOS is playing up and asks if you can pay cash.
If you have cash: pay the fare, take the printed receipt, done.
If you don't have cash: ask the driver to radio the operator for a manual transaction processing. It takes 2 minutes. Do not accept a "backup terminal" or a handwritten slip — that's where the swipe-and-inflate scam starts. If the driver refuses both, call the operator's 24-hour number on your booking email and resolve from there.
The driver has no legal right to demand cash. The operator has processed thousands of "machine down" scenarios through radio dispatch.
What about tipping
Tipping isn't customary in Australia, including taxis. Round up to the nearest $5 if you were happy with the service. That's the norm.
With cash, rounding up is trivial. With card, some terminals allow a tip entry step; many don't. If it matters to you, have a small amount of cash for tips specifically.
The short version
- Cash is $3 to $4 cheaper per airport run.
- Card gives you better protection and better paper trail.
- Chip-and-PIN is safer than tap at any taxi in Melbourne.
- Hybrid: carry both, default to chip-and-PIN, use cash if something looks off.
For most travellers, the 4 percent surcharge is worth paying for the convenience and the dispute protection. For frequent flyers and business travellers who want every receipt and statement, stick with card. For occasional travellers with AUD already in their wallet, cash is fine.
The worst choice is none of the above — "oh, my card didn't work" mid-trip and no backup. Have both available before you get into any taxi.