New Zealand has passed new legislation to regulate merchant service fees. The Retail Payment System Bill passed its third reading yesterday, with Commerce and Consumer Affairs Minister David Clark claiming the regulation of fees will save New Zealand businesses around NZ$74 million a year.
The move to legislate was sped up by the pandemic, which saw a shift from Eftpos to contactless debit, credit and online payments. “It is vital that retailers are able to keep up with their customers’ needs,” Clark said.
The legislation:
• sets limits on interchange fees;
• enables the Commerce Commission to monitor the retail payment system and directly intervene to regulate designated networks; and
• empowers the Commission to ensure any surcharging by merchants is reasonable.
Interchange fees for credit card transactions will be capped at 0.8 per cent in line with Australia.
The interchange fees charged for online debit card transactions will be capped at 0.6 per cent, contactless debit card interchange fees will stay at their current levels of 0.2 percent or less, and for swiped and inserted debit cards there will be no charge.
“This will have an impact on both Mastercard and Visa and will come into effect six months after enactment. This is the quickest it can be done and is swifter than when similar changes were made in Australia,” Clark said.