You order a coffee and a muffin at your local cafe expecting to pay $12. But before you tap your card or wave your phone at the machine, the EFTPOS terminal shows $14.70, so you query it.
“Sorry about that,” says the kid behind the counter, not sounding sorry at all. “There’s the card processing fee, the weekend surcharge, the public holiday surcharge because the staff are on time-and-a-half, the cost-recovery surcharge management added last month, the power surcharge because electricity’s gone up again, and the diesel surcharge for the extra delivery runs. It all gets stacked automatically. I just press the button.”
Congratulations — you’ve just paid $14.70 for a $12 coffee and muffin. And somewhere in there, little Johnny’s pre-school fees went up too, though I’m still not entirely sure how that made it onto my receipt.
This is New Zealand in 2026: a country where retailers have decided the sticker price is a suggestion, and the real price gets revealed one surcharge at a time, at the exact moment walking away feels most awkward. It’s a con dressed up as “transparency,” and it’s costing us a fortune.
In September 2025, the Government introduced the Retail Payment System (Ban on Merchant Surcharges) Amendment Bill. On paper it sounded sensible: ban surcharges on in-store EFTPOS, Visa and Mastercard payments — tap, swipe, phone, whatever. No more nasty surprises at the till. The Government even promised it would be law by May 2026.
It’s now August. May came and went. So did the surcharges.
The Commerce Commission reckons New Zealanders pay up to $150 million a year in card surcharges, and that $45 million to $65 million of that is “excessive” — more than it actually costs the merchant to accept the payment. Mastercard puts the excess even higher, north of $90 million. Either way, it’s real money out of real pockets for the privilege of paying with a piece of plastic. The select committee even recommended passing the bill back in November. The stall is purely political.
So why hasn’t the ban happened? Because the coalition can’t agree — and while they argue, retailers keep stacking the fees.
ACT leader David Seymour calls the bill “dead” and “bad economics”, arguing that banning surcharges just pushes the cost into everyone’s prices. New Zealand First’s Winston Peters was blunter: it’s “going nowhere.” The Prime Minister called it “taking a breather,” which is a polite way of saying it’s been shoved in a drawer.
Without ACT or NZ First, National can’t pass the bill on its own, and Labour isn’t keen either — at select committee it opposed “adding costs to small businesses.” The minister who introduced the bill, Scott Simpson, has moved on; the portfolio now sits with Cameron Brewer, who insists the policy “hasn’t changed” and it’s just “a case of timing.” Finance Minister Nicola Willis says it “still remains the Government’s intention” to kill the PayWave fees.
Translation: don’t hold your breath.
Here’s the part business commentators tiptoe around. Yes, card processing costs retailers money — more than it should. But let’s be honest about where that cost actually comes from: Visa, Mastercard and the banks charging interchange and merchant service fees that bear no resemblance to the real cost of processing a tap. That’s the true rip-off, and it’s the banks — most of them Australian-owned — who should be held to account for it, not the customer standing at the till.
The Commerce Commission has already cut those interchange fees, saving businesses up to $90 million a year on top of the caps it set in 2022. So the merchants’ costs are falling even while their surcharges stay put. Funny, that.
But retailers aren’t helping themselves. Card acceptance is a cost of doing business, just like rent, power, public holiday wage rates or the freight bill. You don’t itemise your power bill on every receipt, so don’t itemise the bank’s fee either. Build it into your prices, absorb it like every other overhead, and compete honestly on the number on the shelf.
If your business model depends on ambushing customers with fees they can’t see until the receipt prints, that’s not a pricing strategy — that’s a trust problem.
The EU, the UK and Malaysia have already banned retailers from adding card payment surcharges. They adjusted. We can too. And let’s be real: the businesses complaining loudest about a ban are often the ones making the most from stacking these charges.
Every one of those fees gets justified on its own — a public holiday here, a diesel run there — and somehow they all turn up on the same receipt, on the same day, for the same muffin. That’s not cost recovery. That’s a business model.
Retail NZ’s counter-proposal is to regulate surcharges rather than ban them — cap debit card surcharges at 0.5 per cent and credit cards at 1 per cent. That might be the compromise Parliament eventually lands on. But right now there’s no cap. There’s nothing. Just a bill languishing on the Order Paper while every EFTPOS terminal in the country keeps doing exactly what it was doing before Wellington promised otherwise.
Across the ditch, Australia has spent years threatening its own ban, and its Reserve Bank is now having second thoughts about the small-business blowback. We can sit back and watch which country blinks first — or whether either of them actually helps the customer.
Public support for a ban sits close to 60 per cent, with only 15 per cent opposed, according to Consumer NZ polling. This isn’t a fringe gripe. Most of us are sick of it.
If surcharges are now a permanent feature at the checkout, there’s a simple dodge: insert your card and select EFTPOS rather than tapping. The surcharge applies to contactless and credit card payments, not to chip-and-PIN EFTPOS. And if a retailer still wants to itemise every overhead, tell them the solution is simple — build the cost into the price and stop ambushing customers at the terminal.
The ban might be dead, but the fee doesn’t have to be permanent. Make the retailer own the price they put on the shelf — and if they won’t, take your money somewhere that will.
Steve Baron is a New Zealand-based political commentator and author. He holds a BA with a double major in Economics and Political Science from the University of Waikato and an Honours Degree in Political Science from Victoria University of Wellington. A former businessman in the advertising industry, he founded the political lobby group Better Democracy NZ. https://stevebaron.co.nz