Credit Card Surchage - Are you changing your method of payment?

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Forums › Finance and wealth management › Credit Card Surchage - Are you changing your method of payment?

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#3413937 11-Sep-2025 22:56

Handle9:

cruxis:

With surcharges getting banned, here’s a clean workaround for retailers:

Bundle card processing fees into shelf prices, then offer a 1% discount for preferred payment methods like EFTPOS. It’s not a surcharge—it’s a reward for helping keep costs down.

Example:

“Groceries: $100.00 Pay with EFTPOS and get 1% off — just $99.00”

Simple, and fair. The business keeps most of the savings, the customer gets a slice, and Visa doesn’t eat your margin. Call it a “Local Payment Bonus” or “Cashflow-Friendly Discount” if you want to soften the optics. Kiwis love rewards. Like turning eftpos system into a reward card scheme?

I would imagine the law will ban this type of nonsense. It's semantics to try and avoid the point of the law.

I remember years ago when retailers didn’t charge CC fees, that cash discounts were common. You could ask the retailer if they would give a deal if paying by cash. I can’t see how a law could stop a business giving a discount and how would they even police it.

Handle9

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#3413938 11-Sep-2025 22:58

mattwnz:

Handle9:

I would imagine the law will ban this type of nonsense. It's semantics to try and avoid the point of the law.

I remember years ago when retailers didn’t charge CC fees, that cash discounts were common. You could ask the retailer if they would give a deal if paying by cash. I can’t see how a law could stop a business giving a discount and how would they even police it.

Very easily, the same way it's illegal to advertise "interest free terms" and then offer a discount for cash.

The system was in place previously and then the law was changed to allow surcharges. This really isn't rocket science.

mudguard

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#3413954 12-Sep-2025 08:14

Handle9:

Very easily, the same way it's illegal to advertise "interest free terms" and then offer a discount for cash.

The system was in place previously and then the law was changed to allow surcharges. This really isn't rocket science.

Yeah I recall an old manager of mine delighting in negotiating a "cash" deal then taking it on the interest free terms advertised.

Handsomedan

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#3413960 12-Sep-2025 08:29

gzt:
NZHerald: "Shoppers who pay by Eftpos will subsidise contactless card users under surcharge ban, officials warned Government"

Is the government making the no surcharge rule just for the contactless aspect or does the no-surcharge rule apply to the entire transaction including the purely credit card related percentage fee?

Surcharging for any and all Card transactions in a Card Present environment are being banned.

That includes contactless and dip/swipe transactions.

Surcharges will be axed to put money back in Kiwis’ pockets, says Commerce and Consumer Affairs Minister Scott Simpson.

“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.”

Source: https://www.beehive.govt.nz/release/scrapped-surcharges-win-new-zealanders

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dcsharp

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#3421462 4-Oct-2025 11:09

Our main supplier who also does wholesale and has retail stores has implemented a processing charge on all on account payments to offset their retail in store charges. Also got a notice from ONE NZ that they are now doing the same.

That’s at least $800-$1000 in fees we weren’t paying from that one supplier.

Not entirely sure what anyone expected, I haven’t noticed instore increases anywhere yet, but I actively avoid stores…

eracode

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#3463290 20-Feb-2026 10:44

Disappointing to see this NZH story today about the surcharge legislation possibly being delayed or canned.

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richms

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#3463294 20-Feb-2026 10:54

I'm glad to see the surcharges remain.

Use eftpos. Keep your transactions as local as they can be. Pressure banks to adopt eftpos by contactless instead of selling out to US operated visa and mastercard.

Richard rich.ms

Behodar

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#3463298 20-Feb-2026 11:03

While I can't say I'm "glad" of surcharges, I use Eftpos whenever it's available. That includes online though e.g. PB Tech, where it works well. Alas there are at least two providers of Online Eftpos and the other one (not the one PB Tech uses) consistently just tells me "something went wrong" right off the bat... but I'm getting a bit off-topic here.

FineWine

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#3463306 20-Feb-2026 11:47

For those of you who do not receive Consumer NZ emails, here is their take on this.

20 February 2026

Support for surcharge ban getting stronger Consumer NZ urges the government to push ahead with a surcharge ban, with research finding almost three in five New Zealanders support a ban on card payment surcharges, and only 15% oppose the proposal.

It’s estimated that excessive card payment surcharges cost New Zealand shoppers approximately $65 million a year. Yet since December 2025, businesses’ costs associated with accepting card payments have reduced, saving businesses an estimated $90 million a year.

“Two-thirds of New Zealanders think that businesses should cover the cost of card payments themselves,” says Jessica Walker, Consumer NZ campaign manager.

Since 2023, Consumer has received over 300 complaints about excessive surcharges. The highest reported surcharge was 25%.

Walker says New Zealanders are frequently being stung by excessive, hidden and unavoidable surcharges.

“Too many businesses are flouting the guidelines which say surcharges should be transparent, avoidable and not excessive.

“Over a quarter of New Zealanders told us they think they are rarely or never informed of surcharges ahead of payment, and more than four in ten said they've paid a surcharge because they couldn’t use a no-fee option.”

According to Consumer, the best way to fix the surcharge mess is an all-out ban.

“A ban would be simple for businesses and would stop consumers from being hit with hidden or excessive surcharges. If a business chooses to pass on additional costs due to the ban, we expect those costs to be minimal.

“Internationally we are seeing a more progressive stance when it comes to surcharging, with Australian regulators signalling they will ban surcharges on debit and credit card payments from mid-2026. In the UK and EU, surcharging is already largely banned. We don't think it's fair New Zealand consumers are expected to continue shouldering these costs.”

Consumer says there’s widespread surcharge frustration amongst shoppers and it's time for the government to fix the surcharge mess.

Note to editors

Survey data is from the Consumer NZ Sentiment Tracker; a nationally representative survey of 1,000 New Zealanders aged 18+ conducted 21-29 January 2026 (margin of error ± 3.1% at the 95% confidence level). Respondents were excluded if they had completed the Sentiment Tracker at any point in the previous 12 months.

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gmball

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#3463309 20-Feb-2026 11:58

While I don’t personally have an issue with banning surcharges, if these fees genuinely represent a real cost to businesses, won’t those costs simply be built into higher prices? I doubt most businesses would absorb them entirely.

What I’ve never understood is the inconsistency. Some businesses use terminals that automatically apply and disclose a surcharge, while others manually calculate a fee and enter a higher total into the terminal. I’ve seen surcharges vary anywhere from 1% to 4%, which suggests there’s little standardisation.

If surcharges were clearly tied to the actual cost of processing the transaction, it would be much easier to accept them. Instead, many businesses seem to apply whatever percentage they think they can justify, regardless of whether that reflects their true merchant fees. That lack of transparency hasn’t done businesses any favours, and the end result is more legislation.

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#3463310 20-Feb-2026 12:04

@FineWine:

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CokemonZ

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#3463311 20-Feb-2026 12:18

gmball:

While I don’t personally have an issue with banning surcharges, if these fees genuinely represent a real cost to businesses, won’t those costs simply be built into higher prices? I doubt most businesses would absorb them entirely.

What I’ve never understood is the inconsistency. Some businesses use terminals that automatically apply and disclose a surcharge, while others manually calculate a fee and enter a higher total into the terminal. I’ve seen surcharges vary anywhere from 1% to 4%, which suggests there’s little standardisation.

If surcharges were clearly tied to the actual cost of processing the transaction, it would be much easier to accept them. Instead, many businesses seem to apply whatever percentage they think they can justify, regardless of whether that reflects their true merchant fees. That lack of transparency hasn’t done businesses any favours, and the end result is more legislation.

I own a smallish retailer.

Depending on how your machines are organised it can be wildly different.

For example you can have your bank can charge merchant service fees (typically a base fee then ~1% on top for anything that is credit - incl contactless, and then windcave or other charges an acquiring fee - another 1 - to 1.5% fee.

Eftpos, and inserted debit cards where cheque is pressed will typically cost nothing.

Alternatively some providers offer a blended fee - you pay a flat rate per transaction, credit, debit, contactless or other. This make it easier to calculate costs, but you are paying the fee on otherwise free transactions above like inserted debit. We went this way so I can offer no surcharge, and just incorporate the fee into every transaction. It also means you have more negotiating power, as they take a cut on everything that isn't cash.

It's actually very complex as a merchant to decide what works for them, and is the reason you will often see dairys/bakeries saying no credit - the transaction fees are generally a flat monthly rate, not variable at that point. I have a very complicated excel doc for us, and tbh still am not sure which is the right way to go.

Don't even get me started on afterpay where they take a chunk - up to 4% and the bank/acquirer takes their chunk too! Brutal!

The actual cost per transaction can be variable based on card type and your scheme. So a merchant will typically figure thier most expensive transaction, and do that as the surcharge. 2.5% is fair, and for a smaller merchant could be higher.

It sucks for everyone!

danielparker

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#3463312 20-Feb-2026 12:31

Behodar:

While I can't say I'm "glad" of surcharges, I use Eftpos whenever it's available. That includes online though e.g. PB Tech, where it works well. Alas there are at least two providers of Online Eftpos and the other one (not the one PB Tech uses) consistently just tells me "something went wrong" right off the bat... but I'm getting a bit off-topic here.

Paymark / Worldline seam to be PBTechs.. Who is the other?

richms

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#3463319 20-Feb-2026 12:35

The issue is the terminal has no idea what the fees will be to add the appropriate surcharge, so even tho a contactless debit card may end up being less that the processing costs the merchant, the terminal has no idea of what the card is before it is tapped, and someone would have to maintain a BIN to surcharge table.

At least afterpay is adding some value to the consumer. A contactless debit card has no benefit over eftpos as its out of the account immediately, A credit card also has benefit for them. I generally use afterpay whenever I can as that lets me collate small purchases and then do a big payment on the gem visa of more than $250 to get the 6 months interest free. No idea if they will block that like they are using the gem to get interest free on topups to wise.

Richard rich.ms

Handsomedan

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#3463348 20-Feb-2026 15:07

CokemonZ:

2.5% is fair

Is it, though?

If you didn't accept card payments, would you get anywhere near the amount of business that you do?

What about advertising and marketing? Do you surcharge for that?

Or if you didn't utilise power - i.e. the retail outlet is perpetually dark and uninviting, there's no electronic, as there's no power, so it's cash only in a lockbox, drawer or safe.

Do you surcharge for those costs? Rates? Rent?

Surcharging has to go - you choose what to accept as payment as a part of your business model - if that includes a method that costs you, you need to work out how to roll that into the overall price of everything you sell.

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