2026 Surcharge Ban: Guide for NZ Businesses

By EFTPOS NZ September 10, 2025 4 minutes read time

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New Zealand’s government is moving to ban most surcharges on in-store card payments. The change is coming through the Retail Payment System (Ban on Surcharges) Amendment Bill, which aims to eliminate the extra fees many businesses charge when customers pay with credit or contactless debit cards. The Bill passed its first reading on 17 September 2025. It will now move to select committee stage for review and public submissions.

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Kiwi shoppers currently pay up to $150 million a year in surcharges, with about $65 million of that considered excessive. From May 2026, these fees will be banned for most domestic card payments made in person. This guide outlines what transactions are affected, the expected timeframe, and what it means for your business.

What changes now?

Surcharging is still legal under the current rules. Eftpos NZ will keep your payment system compliant and give you plenty of notice before anything changes. We're also exploring how to support any allowed surcharges under the new law, so you can recover costs where possible.

What types of payments will the ban cover?

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The proposed ban applies to most in-person card payments made using New Zealand-issued debit or credit cards on the Visa and Mastercard networks. That means no surcharge at checkout for domestic EFTPOS, Visa or Mastercard payments made in-store, whether the customer taps, inserts, or swipes.

Here’s a summary of what will be included:

NZ-issued Visa and Mastercard debit card payments (including contactless/PayWave)
NZ-issued Visa and Mastercard credit cards
Foreign-issued Visa and Mastercard cards
Commercial and business cards
EFTPOS (PIN debit) transactions — These never incur merchant service fees, but were occasionally mis-surcharged. Going forward the Bill will explicitly state that no surcharge can be applied

What payments are not affected?

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The government has said the following transactions are excluded from the ban, and can still be surcharged:

Online card payments (e.g. via ecommerce)
Cards from other schemes like Amex or Diners Club
Prepaid and gift cards used in person

Timeline: When will the changes happen?

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17 September 2025 - The Amendment Bill passed its first reading
After first reading - The Bill goes to the Finance and Expenditure Committee. Public submissions are opened during this stage.
12 October 2025 - Deadline for public submissions
1 December 2025 - New Interchange fee caps take effect for cards already regulated
1 May 2026 - New Interchange caps on foreign‑issued cards take effect
By May 2026 - The surcharge ban is expected to take effect

Until then, you can continue to apply surcharges under the current rules. We'll confirm the final date and update you with plenty of lead time. Once the Bill is passed into law, businesses will likely have around one month to comply before the changes take effect.

Interchange fee caps

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This change follows earlier work to lower interchange fees — the behind-the-scenes charges paid between banks on every card transaction. These fees are a major part of the cost that merchants recover through surcharging.

From 1 December 2025, domestic card interchange fees will be capped at:

0.20% for contactless debit (EFTPOS remains $0)
0.30% for credit card transactions in person

Foreign-issued cards will be capped from 1 May 2026 at around:

0.60–0.70% for in-person transactions
~1.5% for online credit card payments

Prepaid and commercial cards are not yet capped.

The Commerce Commission estimates total annual savings of up to $90 million for businesses once the full fee caps and surcharge ban take effect. An average small business is estimated to save about $500 annually from the 2025 fee cuts. To benefit fully from the new interchange fee caps, your merchant service fees must be structured on a variable pricing model. Fixed-rate plans will not automatically adjust to reflect these changes. Learn more about the benefits of bank-backed variable pricing models here.

What consumers and businesses are saying

Consumers - Groups like Consumer NZ are pleased about the proposed changes. They’ve campaigned against high surcharges for years, and see this as a win for fairness.

Small businesses - Some are concerned about losing the ability to pass on costs, especially in tight-margin sectors. Industry groups will likely push for adjustments during the Bill’s review.

Card networks - Visa and Mastercard support the change. They say lower fees and simpler checkouts benefit everyone.

Charities and exceptions - Some groups, like hospice shops, may seek exemptions due to tight budgets and fundraising needs. These will be debated during the Bill process.

What should you do now?

Have your say

You can make a submission sharing your thoughts on the amendment to the Bill here.

Plan for the change

Start thinking about what to do once surcharging is no longer an option. Could you adjust your pricing to absorb the cost? With lower fees from the Interchange caps, that might be manageable. Eftpos NZ customers can use Verifone Central to run a report showing how much they collect through surcharges. Learn how to create a surcharge reporting template here.

Ask your payment provider about lower fees

From December 2025, you should see lower merchant service fees thanks to the new caps. If your fees don’t drop, ask your provider why.

Stay up to date

We’ll keep you posted as the law progresses. Once the Bill is passed, we’ll let you know what changes to make and when. Subscribe to our newsletter here.

Looking ahead

Most in-store surcharges will likely be gone by May 2026. We’ll keep you informed at every step! We're here to help you stay compliant, plan ahead, and make the most of lower payment fees.