The Commerce Commission has decided to cap interchange fees on Mastercard and Visa commercial credit cards, cutting local businesses’ costs by about NZD 40 million a year.
Bryan Chapple, Commissioner, said that this action, combined with earlier cuts to interchange fees on personal cards, should reduce businesses’ costs by around NZD 290 million each year.
He believed reducing these fees will keep the costs businesses pay to accept Mastercard and Visa cards reasonable and improve incentives for payment issuers, like banks, to consider supporting alternative payment methods.
Chapple added that encouraging new technologies and market entrants will ultimately deliver better outcomes for Kiwi businesses and consumers by driving more innovation, value, and choice in how payments are made and accepted.
“Over time, this would support a fairer and more efficient payments system for New Zealand,” said Chapple.
Commercial credit cards make up a small share of transactions but generate a disproportionately large share of interchange fees, which businesses pay through merchant service fees.
Commercial credit cards typically offer cardholders benefits like loyalty programmes, expense reporting, and interest-free credit, which businesses partially pay for through interchange fees.
These fees ultimately flow through to retail prices, meaning everyone pays for benefits only some people receive, creating an inefficient system.
The new interchange fee caps will come into effect on the 22nd of April 2027. Businesses should review their merchant service fee arrangements and contact their payment service providers to understand how the changes may affect their costs.
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