The Commerce Commission has released draft guidance explaining new interchange fee caps for Mastercard and Visa networks that will come into effect in November. Interchange fees are charged by the card issuers for payments within their networks and contribute significantly to merchant fees charged to businesses. The ultimate impact of the cap will be payment savings shared with consumers.
“We expect the November price limits on interchange fees will put downward pressure on the merchant fees paid by businesses. Assessing and enforcing compliance with these limits will be the first priority of the Commission’s work to promote competition and efficiency in the retail payment system,” said Commissioner Dr John Small.
“Any reduction in merchant fees will decrease the cost to businesses of accepting payments on these networks. As the cost of receiving payments comes down, we expect savings to be shared with consumers.”
The Commerce Commission welcomes comments on the draft and submissions that will help shape the final guidance.
“To ensure that this happens, businesses should ensure any surcharging reflects the cost of providing a payment option. If needed, the Commission is able to issue standards to require surcharges to be reflective of the actual cost to the business.”
