Commerce Commission chairman John Small defends LinkedIn post about Uber
The commission regulates competition and fair trading laws in New Zealand and ensures businesses comply with the Commerce Act, which prohibits anti-competitive behaviour.
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Scrapped Surcharges A Win For New Zealanders
Hon Scott Simpson Minister of Commerce and Consumer Affairs Surcharges will be axed to put money back in Kiwis' pockets, says Commerce and Consumer AffairsMinisterScottSimpson. 'Surcharges are a hassle and an unwelcome surprise when shoppers get to the till. That pesky note or sticker on the payment machine will become a thing of the past. 'We're banning surcharges so consumers can shop with confidence knowing how much they will pay for their purchases. 'New Zealanders are paying up to $150 million in surcharges every year, including excessive surcharges of up to $65 million. That's money that could be saved or spent elsewhere. 'By May 2026 at the latest, we will ban surcharges for in-store payments. 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 ban follows the Commerce Commission decision to reduce interchange fees paid by businesses to accept Visa and Mastercard payments, a move to save businesses around $90 million a year. 'Surcharges cover the fees businesses pay for accepting contactless payments and credit cards, but we know these are often excessive. 'In some cases, the retailer doesn't even make it clear what the percentage is. 'A ban on surcharges means no more surprises for people who currently feel like they're being charged to use their own hard-earned money. It means they can make a purchase knowing exactly what they'll pay, and how they'll pay it.' Notes: The Retail Payment System (Ban on Surcharges) Amendment Bill is expected to be introduced by the end of this year. The ban will apply to most in-store payments made using domestic Mastercard, Visa debit, credit cards and EFTPOS. Transactions through the Visa and Mastercard networks and by EFTPOS are the main method of card payment in New Zealand. The Commerce Commission estimates New Zealanders pay about $150 million in surcharges annually including $45-$65 million in excessive surcharges. The Commerce Commission has already announced lower interchange fees paid by businesses to accept Visa and Mastercard payments. Interchange fees make up approximately 60% of merchant service fees. In the United Kingdom and across the European Union, surcharges for debit and credit cards for designated schemes are banned. Australia currently has surcharging on debit and credit cards, but this must be no more than the cost to retailers of accepting these cards. The Reserve Bank of Australia has recently proposed banning surcharges altogether for EFTPOS and Visa and Mastercard debit and credit cards.
Scoop
6 hours ago
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Surcharge Ban Will Benefit Consumers, Retail NZ Says
Banning surcharges will improve the retail experience for customers but risks prices being increased to cover the costs of accepting credit card payments, Retail NZ says. 'Retail payments are a contentious and complex area for retail businesses. We are pleased the Government has listened to our calls for changes in the system, to enable retailers to provide better customer experiences,' Retail NZ Chief Executive Carolyn Young says. The changes will mean retailers cannot add surcharges to in-person domestic debit and credit cards. However, businesses will still be able to add surcharges to online sales, pre-paid and international credit cards. The changes are expected to come into force by May 2026 at the latest. Removing surcharges from in-store purchases is a positive move for domestic consumers, but the wider issue of pricing will need to be considered, Ms Young says. 'Retailers continue to face costs to accept debit and credit card payments and these costs will likely be added to product prices in future,' she says. The surcharge ban will likely see an accelerated decline in EFTPOS payments by consumers. EFTPOS payments do not incur any fees to retailers. As consumers change from using EFTPOS to contactless debit and credit cards, there will be a corresponding increase in the fees paid by retailers, so the benefits in the reduction of the interchange fee will be short-lived, especially for SMEs. A 2024 survey of Retail NZ members found that only 25.6% of respondents applied surcharges. Almost half of retailers calculated a rate that covered their costs, while 39% took advice from their terminal provider or relied on information from their bank statement. About 5% looked at what other retailers are charging. Members told us that the complexity of the Merchant Payment System prevented them from fully understanding the charges and fees they pay. These fees include interchange fees, scheme fees, switch fees, other external costs, internal costs and an acquirer margin. Considerable work will be needed to ensure that terminals have the ability to distinguish between domestic debit and credit cards, and commercial or international credit cards, and charge differential surcharge rates, Ms Young says. Retail NZ's position is that all cards should be treated equally. Retail NZ also wants certainty around the Commerce Commission's ability to monitor and enforce both the new interchange fees and the ban on surcharging. The Commerce Commission will need to ensure that the fees being charged to merchants reflect the new legislation, that the savings are passed on to retailers and that other fees are not increased. 'We will be seeking more detail on the surcharge changes, particularly around commercial credit cards which are not mentioned in today's announcement, and possible future changes to online transactions. We look forward to continuing to engage with the Government as it progresses these changes,' Ms Young says.
Scoop
8 hours ago
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Surcharge Ban May Shift Costs Rather Than Eliminate Them
Hospitality NZ supports the Government's proposal to ban surcharges on card payments, but cautions the move could result in increased costs being absorbed into general pricing for many hospitality businesses. The Government has announced that the Retail Payment System (Ban on Surcharges) Amendment Bill will be introduced by the end of 2025, with the ban expected to come into force by May 2026. It will apply to most in-store transactions using domestic Visa, Mastercard and EFTPOS. Steve Armitage, Hospitality NZ's Chief Executive, says: 'We appreciate the intent behind this change. Simplifying the checkout experience for consumers is a positive step.' 'But at the same time, it's important to recognise that electronic payments come with real costs to businesses. If surcharges are removed, many operators will have to adjust their pricing to reflect that – particularly for small hospitality operators already under pressure.' The Government estimates the move could save consumers up to $150 million a year, including $65 million in excessive surcharges. However, Hospitality NZ notes that these savings will depend on how businesses respond and whether cost recovery mechanisms remain viable. Steve Armitage continues: 'Margins across the hospitality sector remain very tight. Some operators may be able to absorb the cost, but for many, particularly smaller businesses, that won't be realistic. These businesses may have no option but to reflect those costs in their pricing.' Hospitality NZ welcomed the Commerce Commission's recent action to reduce interchange fees – a major component of payment processing costs – and supports further efforts to ensure banks and payment providers pass those savings on to merchants. Steve Armitage says: 'The reduction in interchange fees is a helpful step, and we'd like to see more transparency in how those savings are shared. 'Our priority is to make sure that any changes introduced are sustainable for hospitality businesses and ultimately deliver a fair outcome for both consumers and operators.' Hospitality NZ looks forward to engaging constructively with the Government as the Bill progresses and to ensuring practical support is available for hospitality businesses adapting to the new framework.
