The New Zealand Chambers of Commerce (NZCCI) caution that although the government’s proposed ban on retail payment surcharges is well-meaning, it could inadvertently impose high costs on small and medium-sized businesses (SMEs).
Commerce and Consumer Affairs Minister Scott Simpson has announced the government’s intention to prohibit surcharges on most in-store payments. Simpson said the ban on surcharges for in-store payments will take effect by May 2026 at the latest.
However, for Auckland Business Chamber chief executive Simon Bridges, banning surcharges across the board, while well-intentioned, “could end up doing real harm to small businesses, particularly in retail, hospitality, and tourism.”
The Commerce and Consumer Affairs Minister suggests the move will return money to Kiwis’ pockets, but Bridges argues that the change could have the opposite effect, placing additional financial strain on many small operators already facing economic challenges.
For the NZCCI, the government’s proposal could change New Zealand’s payment system from one where users bear the cost to one where everyone shares the expense.
“That’s not a silver bullet—it’s a blunt instrument. And it certainly doesn’t solve the real problem,” Bridges said.
“The cost of accepting card and digital payments is still there—banning surcharges just hides it.”
The NZCCI is instead calling on the government to address the issue at its root.
“If the government wants to make a real difference for consumers and small business, it should focus on the merchant fees charged by banks and payment providers.”
“That’s where the pressure should be applied.”
The NZCCI intends to submit a formal response to the Retail Payment System (Ban on Surcharges) Amendment Bill when it is presented in Parliament later this year.
Bridges also said that the Chambers will maintain ongoing dialogue with members and ministers in the meantime.