When will paywave be mandatory ??

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Forums › Finance and wealth management › When will paywave be mandatory ??

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#1232802 8-Feb-2015 08:50

The supermarkets I believe have a very good deal on fees, less than 1% I think.
Reason for the fee? When using a credit card, you are effectively borrowing money for up to 55 days, close to two months. If the annual interest is say 12-18%, then that's 2-3% if the purchase.

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#1232817 8-Feb-2015 09:25

Geektastic:
KiwiSurfer: I prefer not to use Paywave and use my old magnetic strip EFTPOS card not because I don't like the technology, in fact I think contactless payments is a *great* idea, but because it's been badly implemented in NZ (and probably elsewhere too).

I dislike that all transactions has to be processed via Visa/Mastercard even if it could be processed locally. 2% may not sound like much until you think someone spending $20,000 a year on good and services in NZ will see $400 a year going off-shore to Visa/Mastercard just for merchant's access fees to their network.

If that still doesn't sound like much, assume there are 2million working adults in NZ spending an average of $20,000 a year... Thats a potentinal total of $800,000,000 a year going to Visa/Mastercard if everyone decided to use Paywave for their daily shopping.

I can't see the point in that much money going off NZ shores to fund Visa/Mastercard's payment infrasturcture when we already have a perfectly good EFTPOS system here in NZ that will cost us (both consumers and merchants alike) far less.

I would be disappointed if all mercants were required to accept only NFC payments and I would probably switch to cash in protest if this was the case. I don't think this will happen for some time yet though.

If banks ever release a NFC card that has transactions routed via the local EFTPOS system I'll be first in line. Until then I'm sticking with my old strip card. Even the chip card would be fine when my bank eventually transitions to those.

What's wrong with Visa making money by providing a service?
.

Nothing wrong with Visa making money from providing a service. But in a world of choice, I just prefer to give my 2% to the local business, rather than Visa.

sdavisnz

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#1232824 8-Feb-2015 09:41

Looking forward to the day I can pay a transaction of Bitcoin from my nfc smartphone...

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sbiddle

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#1232830 8-Feb-2015 10:05

jarledb: From what I understand the average margin on groceries are very slim, so having to pay around 2% transaction fee would mean you are basically giving the groceries away. Thats why you won't see any of the big grocery chains accepting credit cards or paywave.

All supermarkets accept credit cards and now have Paywave/Paypass.

khull

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#1232833 8-Feb-2015 10:12

I think Nate's statistics (I have yet to visit your cafe - just keep forgetting) shows a large majority of people are 'rational' and spending on food on money they actually have (cash/eftpos) - however I suspect a large proportion also load up on the credit card for larger purchases thinking it is okay to do so after being able to afford to eat out and pay settle without putting it on credit

richms

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#1232839 8-Feb-2015 10:48

khull: I think Nate's statistics (I have yet to visit your cafe - just keep forgetting) shows a large majority of people are 'rational' and spending on food on money they actually have (cash/eftpos) - however I suspect a large proportion also load up on the credit card for larger purchases thinking it is okay to do so after being able to afford to eat out and pay settle without putting it on credit

Or they are preferring the convenience of paypass/paywave, or they are managing their money well and using the free credit for up to 55 days to allow them to leave their money somewhere else for that time.

If you have a $3000 limit and you average half that over the whole month, that's basically 2-3% of $1500 thru the year, in addition to any rewards incentives you get for using the card. Just because there are some people that cannot handle the cards and end up paying interest on things doesn't mean that everyone is useless with money.

Richard rich.ms

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#1232840 8-Feb-2015 10:50

khull: I think Nate's statistics (I have yet to visit your cafe - just keep forgetting) shows a large majority of people are 'rational' and spending on food on money they actually have (cash/eftpos) - however I suspect a large proportion also load up on the credit card for larger purchases thinking it is okay to do so after being able to afford to eat out and pay settle without putting it on credit

My wife's Amex would average at least $1,500 per month for food and entertaining

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sep11guy

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#1232841 8-Feb-2015 10:51

sbiddle:
jarledb: From what I understand the average margin on groceries are very slim, so having to pay around 2% transaction fee would mean you are basically giving the groceries away. Thats why you won't see any of the big grocery chains accepting credit cards or paywave.

All supermarkets accept credit cards and now have Paywave/Paypass.

Yes they definitely do have them , but 100% of the time from my exp so far, they dont work, so I have to plug in my CC and enter details, do the whole pin thing drama anyways, so it beats the whole purpose of having it.

And thats for varied amounts , $5, $30, $40 , $75 type purchases - never works with whatever value of the purchase

pauls25

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#1232849 8-Feb-2015 11:14

The thing I find frustrating is having to queue at the checkouts in a busy supermarket or shop that has no paywave facility knowing that the queue would move a lot faster with paywave. A standard chip and pin transaction can take 30-60 seconds (New World's old pin pads are particularly slow) compared to 5 seconds or so for paywave. Multiple that time by the 10 people in the queue in front of you and you could be out of there 5-10 minutes faster.

The second frustration thing is watching people in front of you not using paywave where there is paywave. The lack of signage and the bad job of promoting it are mostly to blame. Not everyone knows to look for the "Present" wording on the screen. The green lights are misleading as many retailers have the left most ready light on when they don't accept paywave.

I just got back from Australia where 80-90% of terminals are paywave enabled and it is great. I use credit cards for all purchases to get the credit card points so there is no saving on card fees by disabling paywave with me and yes I will go to a shop that has paywave enabled over one that doesn't just for the convenience.

sbiddle

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#1232858 8-Feb-2015 11:41

sep11guy:
sbiddle:
jarledb: From what I understand the average margin on groceries are very slim, so having to pay around 2% transaction fee would mean you are basically giving the groceries away. Thats why you won't see any of the big grocery chains accepting credit cards or paywave.

All supermarkets accept credit cards and now have Paywave/Paypass.

Yes they definitely do have them , but 100% of the time from my exp so far, they dont work, so I have to plug in my CC and enter details, do the whole pin thing drama anyways, so it beats the whole purpose of having it.

And thats for varied amounts , $5, $30, $40 , $75 type purchases - never works with whatever value of the purchase

I assume you have a Debit card and are shopping at Countdown? It's been discussed in many places (including a few post above in this thread) that they disable some Debit cards because the merchant processes them as a CC transaction incurring extra costs.

sbiddle

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#1232860 8-Feb-2015 11:45

One other interesting thing about the introduction of Paywave/Paypass was the approach McDonalds took. Globally McDonalds have always been one of the first to launch the technology as CC companies get them on board because they're such a big chain.

Here in NZ McDonalds were one of the first to install Ingenico terminals supporting Paypass as a trial for ANZ who were the first bank in NZ to launch (but ANZ totally screwed up their exclusivity agreement, but that's another story entirely). McDonalds then disabled it on their terminals after the trial and it took until the middle of last year before they re-launched. I heard the reason was many store owners didn't want it because they were worried it would result in an increased number of CC transactions which would obviously hurt their bottom line with increased merchant fees.

Kyanar

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#1232863 8-Feb-2015 12:04

dafman:

Nothing wrong with Visa making money from providing a service. But in a world of choice, I just prefer to give my 2% to the local business, rather than Visa.

Visa/Mastercard don't make any money from that. The commission rate is shared between the acquirer and the issuer (if you use a BNZ visa at a place that processes with Westpac the commission will be shared between BNZ and Westpac).

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#1232864 8-Feb-2015 12:11

Interchange rates aren't secret - they are published on all the bank websites.

richms

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#1232869 8-Feb-2015 12:35

Slowness for chip can be blamed on places with their terminals on dialup still, and crap terminals.

A good terminal on ethernet will process in a couple of seconds of hitting ok on the pin. No different to the time after pressing ok on a paywave and pin transaction.

If they would put a heavy surcharge on places using dialup still - That infrastructure cant be cheap to maintain, right? ;) then it would push more places to get it on the internet and not so slow.

Perhaps EMV7 can mandate that, customer site card insertion, and a pin pad that isnt bolted to a stand at chest height where the world can see it.

Richard rich.ms

mckenndk

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#1232921 8-Feb-2015 14:37

I managed POS in my last job for 4 years, they were from DPS and initially we had to swap out our pinpads for chip ones as we had not finished our contract we got the same ones back just with the chip option enabled in them.

When we renewed our contract we got the paypass/Paywave enabled pinpads, we would try and avoid the people with DEBIT cards using the Paywave due to it being processed as a credit card transaction informing the people that we charged a 2% fee for credit card and paypass/Paywave use.
It showed the lack of knowledge/education when they said they were paying by Eftpos and they would tap their card on the paypass/Paywave terminal, we would not charge them the fee in this case but explain to them what to do next time and the reason why.
It is annoying as its a convenient feature but one that the merchant must pay for ever use, good for high volume areas like coffee bars/cafe's.

I could not figure out how Countdown setup their pinpads to reject Debit cards in the paypass/Paywave process and DPS claimed they knew nothing of it even though it was their pinpads and it was a bank thing and the bank said the same.

I first ran into this system in London in a thing between Barclays Bank and Mcdonalds funny enough and saw the odd terminal around NZ before most of us had cards to use.

Currently I'm living in Canada which the banking system is soo different and alot of people prefer cash than card as you save on transaction fees and have a lower monthly account fee but can be a hold up at places like Tim Hortons/Starbucks as people are digging for the last bit of change in their bag.
If you want a credit card you need to have that amount of $ that the card is worth in your bank account, which I won't say is a bad thing.
I only have a Debit card and this is not accepted by some places mainly restaurants which are credit card/cash only.

Back on topic.
Most places here are paywave/paypass enabled but you have to pay per transaction in bank fees if you don't have the correct account charging higher monthly account fees.
Even my Kiwibank credit card worked fine here on paywave.

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