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Lower Interchange fees in New Zealand are here

New Zealand has introduced new regulations on Interchange fees and here’s how they can save you money on card processing.

September 2, 2022
 ·  3 minutes
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Update (14 November, 2022): The Interchange pricing limits have come into effect on 13 November, 2022. Find out more here.

The New Zealand Retail Payment Systems Act 2022 came into force on 13 May, 2022, and Interchange pricing limits on 13 November, 2022.

This Act addresses concerns across industries that New Zealand’s merchant service fees were higher than Australia and the UK. This new regulation will introduce caps to Interchange fees to help reduce merchant service fees on credit and debit card transactions.


Depending on how the payment is being made, different caps on the fees apply.

  • Credit cards: Interchange fees will be capped at 0.80% per transaction*

  • Debit cards (online payments): Fees will be capped at 0.60% per transaction

  • Debit cards (contactless, in-person payments): Fees will be capped at the current level of 0.20% (if levied as a percentage amount) or 5 cents (if levied as a fixed amount) per transaction

As Interchange fees make up the bulk of card processing fees, businesses in New Zealand can look forward to significant cost savings of an estimated $74 million every year.

That’s all great news, but read on if you’re unsure of what Interchange fees are.

Interchange fees, explained

Each time a consumer makes a payment via a credit or debit card, the acquirer pays the cardholder’s bank an Interchange fee, set by card schemes like Mastercard or Visa. Businesses then pay the Interchange fee back as part of the card processing fees.

Traditionally, there’s been little to no insight into how these fees were calculated and adjusted. However, with a push by governments worldwide, like in Australia and across Europe, to regulate and standardize Interchange fees, there’s been an overall increase in transparency.

What affects the amount of Interchange fees you pay?

Ah, the age old question. Many factors come into play but here are some examples.

1. Regionality

Transactions are generally lower if processed locally. This is why it’s better (and cheaper) to use an acquirer based in New Zealand to enjoy the best rates.

2. Type of card

Credit cards tend to have higher Interchange fees compared to debit and prepaid cards as the level of risk is considered to be higher.

3. Type of transactions

Card-present (CP) transactions at physical stores tend to have lower Interchange fees than card-not-present transactions. This is because the risk of fraud is lower when your customer’s card is physically present.

Some of these factors can be influenced to streamline your payments processes and cut costs, but some of them are outside of your control.

Tap on Interchange++ to benefit from these new regulations

The calculation of different payment card costs, including Interchange fees, can be tricky. That’s where Interchange++, our preferred pricing model, comes in. We can help you track changes to the Interchange fees rates, passing on the savings directly to you.

Other pricing models, like blended pricing, may not pass on these cost savings to you.

Additionally, we will also show you a detailed breakdown of each payment card cost, so you’ll know exactly what you’re paying for. No hidden costs or surcharges.

*Cap is not applicable to commercial credit cards.

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