Commerce and consumer affairs minister David Clark revealed yesterday the Government's next steps to reduce merchant service fees, that banks charge businesses when customers use a credit or debit card to pay.
Clark said, "reducing the merchant service fees that New Zealand businesses are being charged is a priority for this Government, and critical to the recovery of the economy".
While eftpos had been the most popular payment method, Covid-19 saw a substantial rise in people using contactless payment as their preferred method.
Following feedback, a Retail Payments Systems Bill will be introduced later this year, requiring reductions in fees and enabling the Commerce Commission to regulate aspects of the retail payment system.
Retail NZ chief executive Greg Harford applauded the move, saying, "for far too long New Zealanders have been paying high merchant fees and it is fantastic news the Government is finally moving to bring us in line with other countries that pay significantly less".
Harford called it "a serious issue that affects all New Zealanders".
"[It is] fundamentally unfair the high cost of payments is borne by all New Zealanders through higher prices."
Restaurant Association CEO Marisa Bidois echoed the statement, calling the move "a welcome decision", and said the increase in contact payment had become "incredibly difficult for our businesses to manage".
"Bringing transparency to merchant fees will serve hospitality businesses far better over the long term than allowing a hands-off approach to continue," she said.
In New Zealand, merchant card fees are currently unregulated; meaning they are much higher than in Australia. Clark said these costs added significant overhead for retailers, who often passed those costs onto consumers through higher prices.
The new legislation aims to bring the fees in line with their Australian counterparts.
Harford also noted the legislation should only be the beginning.
"Additionally, e-commerce, and buy now pay later services, as well as mobile wallets, incur even higher charges. We hope the new regulator will use its powers to review and bring these fees down as appropriate."