Retail NZ’s latest Payment Survey for 2018 has shown that merchant fees set by the banks, known as merchant service fees, are twice as high for Kiwis compared to merchants in Australia.
The survey showed that Kiwi merchants pay twice as much as those in Australia, and between three and six times more than the UK.
For New Zealand, fees for credit cards are 1.6 percent. Compared with Australia’s 0.8 percent and the UK 0.5 percent.
Retail NZ’s general manager for public affairs, Greg Harford, said in relation to the survey that the high fee levels are costing the whole economy.
“The disparity in fee levels is growing as international regulators move to address the inherent unfairness in the fee levels being changed by banks and credit card schemes… A key concern is that the ongoing lack of regulation in New Zealand is driving expensive rewards programmes for premium cards. Because retailers tend to incorporate bank charges in overall pricing, there is effectively an inequitable wealth transfer from less well-off Kiwis to better off New Zealanders,” said Harford.
The survey says that in New Zealand, charges typically apply only when paywave functions are used, but increased customer demand for tap and go options means these added fees are continuing to increase.
Harford says the survey is to provide transparency with the industry as it relates to these payment fees. “Retail NZ continues to hold the view that additional transparency and regulation is possibly required, in order to bring New Zealand into line with comparable overseas jurisdictions.”