Summarised by Centrist
The government plans to outlaw most in-store surcharges on card payments, aiming to save consumers up to $150 million a year.
Commerce and Consumer Affairs Minister Scott Simpson announced the Retail Payment System (Ban on Surcharges) Amendment Bill will be introduced this year, with the ban in effect no later than May 2026.
“Shoppers will no longer be penalised for their choice of payment method, whether that’s tapping, swiping or using their phone’s digital wallet.”
The move follows the Commerce Commission’s recent decision to cap interchange fees, the charges banks impose on merchants for processing card payments, which the commission estimates cost businesses about $90 million annually.
Simpson said surcharges often exceed actual costs, and “in some cases, the retailer doesn’t even make it clear what the percentage is.”
Carolyn Young, Retail New Zealand’s chief executive, said “many retailers are already having a hard time trying to stay open” and predicted some would raise prices to cover lost surcharge revenue.
Matthew Lane, general manager of Night ‘n Day, welcomed the ban but said interchange fees remain a significant business expense. “One of our stores paid over $80,000 to the merchant provider last year,” he said.
The ban covers Eftpos, Visa and Mastercard payments, including contactless, but excludes online and international card payments.
Australia allows surcharges capped at actual cost but is moving towards a full ban.
Editor’s note: The current system shows surcharges separately, offering some transparency and consumer choice, though merchants sometimes overcharge, making fees less clear. With the new ban, these costs will be bundled into overall prices, so consumers may not actually pay less, just see fewer separate fees. In countries like Canada, legal battles over merchants’ right to pass on card fees lasted years because card companies opposed it. The government’s move, while likely well-intentioned, may ultimately align with card companies’ preference to limit merchants’ ability to pass fees directly to consumers.
Read more over at The Spinoff and RNZ
Image: Håkan Dahlström
