35 chambers of commerce, together with industry and business associations, have united to call on the government to abandon the proposed ban on PayWave transaction surcharges.
In an open letter addressed to Commerce and Consumer Affairs Minister Scott Simpson, the group described the plan as a “misguided intervention” that could potentially harm both consumers and businesses.
In July, Simpson announced the government’s intention to prohibit surcharges on most in-store payment transactions.
“Shoppers will no longer be penalised for their choice of payment method, whether that’s tapping, swiping, or using their phone’s digital wallet,” he said.
Surcharges on in-store payments will be banned by May 2026 at the latest.
Hospice New Zealand warned that the government’s plans to ban payment surcharges could lead to unintended consequences.
Chief executive Wayne Naylor said hospices and shops across the country were already encountering funding difficulties.
The hospice shops across the country that sell donated second-hand goods are a key part of the fundraising that hospices do,” he said.
“It’s about half of the income that hospices generate to fund services that go directly to care and support services for people who are dying and their whānau. It’s about $60 million a year.”
“If the surcharges are banned, then hospices and their shops will either have to shoulder those extra costs, which will directly impact revenue, and when every dollar counts, that’s really critical.”
“Or increase the price of goods in our shops, and selling second-hand goods is a challenge in the first place, and price increases are just difficult to do.”
Naylor said that, in general, the public had limited awareness of surcharges.
“If surcharges are banned, they’ll become less visible, and consumers will be paying for it anyway with price increases.”
According to Retail NZ chief executive Carolyn Young, bans in other countries had led to increased use of PayWave services, which carry associated fees.
“Consumer habits will change, and those that are using EFTPOS will transition to contactless. A higher percentage of transactions for every business will go through with a fee attached to it, which ultimately is going to impact margins for businesses and increase prices for consumers.”
Young proposed that the government should temporarily halt the proposed ban and carry out a comprehensive consultation to ensure that both consumers and businesses fully grasp the potential impact of any implemented changes.
She also noted that a blanket ban would distribute the charges linked to certain cards and payment systems across all purchases, no matter which payment method customers use.
“There are different charges across a wide range of cards,” she said. “An international card, a commercial card, Diners, Amex or Union Pay – they’ve got higher fees, and a debit card has lower fees than a credit card.”
“If a surcharge ban is put in place, it’s not visible to a consumer what fees are being paid by the retailer and what increased cost might be occurring.”
“If someone’s going to pay by cash or by EFTPOS, they’re going to pay the same price as someone that’s paying by credit card, so it just continues to camouflage the outcomes for everyone.”
She said surcharges enabled consumers to decide whether they were willing to pay a fee for the convenience of using PayWave.
“If somebody doesn’t want to pay a surcharge, they can either use EFTPOS or they can go to another business. The market decides how people will engage with you.”
“It means that a fair reflection of cost allocation – which surcharging is – won’t be there.”