The Retail Payment System (Ban on Merchant Surcharges) Amendment Bill (the Bill) has passed its first reading in Parliament and is expected to be in effect by May 2026, if not earlier. The Bill will amend the Retail Payment System Act 2022 by prohibiting surcharges on all in-store EFTPOS, Visa and Mastercard payments, whether personal, business, domestic or foreign, and for all forms of cards (eg physical, digital, or tokenised, including where accessed through mobile wallets such as Apple Pay).
Background to reforms
The Commerce Commission estimates that around $65m of the $150m surcharges New Zealanders pay annually are excessive, with approximately 20% of New Zealand businesses surcharging, while most businesses choose to absorb payment costs as a part of their usual cost of doing business.
This proposed ban on surcharging follows the earlier decision by the Commerce Commission to limit interchange fees from 1 December 2025 for cards that are already regulated and from 1 May 2026 for cards that will become subject to caps for the first time (foreign-issued cards) on the Mastercard and Visa credit and debit networks.
Scope of reforms
The Bill proposes to prohibit merchants from charging a payment surcharge for any in-store payments made using the EFTPOS, Visa, or Mastercard payment networks (therefore excluding online transactions and payments through networks other than Visa, Mastercard and EFTPOS). This captures:
- Contactless debit (including prepaid debit) and credit card payments using Visa or Mastercard networks (such as PayWave, PayPass and mobile wallet payments)
- Contacted payments using the EFTPOS network (ie by swiping or inserting the card in the payment machine and entering a PIN).
The ban does not distinguish between cards for personal or commercial use, cards issued in New Zealand or overseas, and forms of card used (eg physical, digital, or tokenised).
Next steps
The Bill has been referred to the Finance and Expenditure Committee with public submissions on the Bill open until 11.59pm Sunday 12 October 2025. Buddle Findlay will continue to monitor legislative developments and publish updates as the Bill progresses.
If you would like to discuss any aspects of the Bill or require assistance with making a submission, please get in touch with our financial services team.
This article was prepared by Andrew Suggate (Senior Associate) and Nicole McAnulty (Solicitor).
