Just got back from the shop, got charged 39 cents for using paywave. Back to eftpos it is!
Don't see why the banks justified charging businesses for what is basically the same service as an eftpos transaction. But now businesses can forward that charge to customers.
@#$% Bankers! Lol
Paywave Surcharge for Customers
Bargainstalker on 20/07/2023 - 15:03
Comments
There's oodles of crypto based things doing that. Can't say I trust them
Fair enough - many people are happy to pay a higher fee (such as, perhaps, PayWave fees) for what they believe to be a better service.
I'm glad we all have a choice.
Plenty of businesses are now charging extra for using credit cards as well. There was a law some 15 years ago that prevented this, but now that law is no more.
You are correct - it used to be that the costs were absorbed by everyone in the general prices whether they liked it or not, whereas now businesses and their customers have a choice whether to pay those fees or not.
Except that buy now pay later (BNPL) sales are not covered by this law change, thus everyone else paying by cash, eftpos or credit card is now subsidising BNPLcustomers.
Is it illegal for a store to charge more for BNPL sales to cover their costs of using that service?
@Alan6984: No, but it's against the contract with BNPL providers, and it's exactly the same as it used to be with credit cards, until government made that illegal… but BNPL don't fall under that legislation, so they can get away with it. History repeats.
I just did a bit of digging and have found that PayWave transactions differ from your usual method of inserting/swiping in that when you use PayWave, an external merchant (Visa or Mastercard) handle the payment and charge the bank a merchant fee. Some businesses then choose to forward this fee onto customers
From an business point of view - I’d be fine passing the fee onto customers. It costs me to provide them with convenience so I forward that fee onto them
From a customer point of view - Why should I be charged this fee when the money comes out of the account the same way from my perspective. It would be like being charged to add sugar to your coffee
As a customer, I find it a little annoying but just opt to insert my card
Totally agree - I take responsibility myself, and choose how to pay based on the options and their relative costs.
As long as there is a 'free' option, I am all for shops giving me the choice of other ways to pay as well.
I take it one step further and where small businesses dont charge a fee i opt to insert.
As a retailer, don't you want the customer to be convenienced so they come back? Also means serving customers faster than having them wait around or have some turn around and go elsewhere because the lines are too long. I know I've done this often when the sushi shop is fluffing around with people inserting their card and the line is long.
Add the price to the products if you need to.
Visa and Mastercard obviously have to pay this fee to cover their costs and profit, as well as covering fraud for stolen monies via paywave.
Your suggestion about adding the fee into the price of goods wouldn’t make a difference though. That cost is still being passed onto the consumer, it’s just now hidden and then you’d be unintentionally passing this fee onto consumers regardless of how they pay
Plus, your 'advertised prices' are now higher than the place down the road that offers their customers a choice of how to pay, and whether to pay any given fee.
From what I understand, credit/debit cards are more expensive than EFTPOS and paywave is more expensive than credit/debit cards.
So it does cost businesses more for Paywave.
Paywave in this country is VERY expensively charged compared to many other countries such as England/Au etc etc. Theres been articles in the news in the past about it but the Govt hasn't seen fit to bother to fix it.
My 39 cent charge was on a $28.99 purchase it does seem high. No idea how its calculated.
Also it's a convenience for everybody stores and customers so its a shame to have this new tech and not use it because of the high charges (relative to the world)
Great point alan about an opportunity for a company to provide a cheaper service. Also totally agree the government should keep it fair and reasonable I'm curious why they lifted the law about credit card charges. Do the banks have much influence on politics? Would imagine they have a lot and the mushrooms (us) never know about it, just a theoryThe rationale for allowing stores to charge a fee (related to the fees they incur for using a particular payment service) was that it is 'unfair' to both the store and consumer that all prices have to be higher to cover those costs, and fairer to allow the costs to be passed on to those that want to use a given service (such as Visa / MasterCard / Amex etc), rather than, say, a straight debit card direct with your bank (often referred to as EFTPOS in NZ despite the term encompassing credit cards and others too).
and now we back again to that situation with Buy-Now-Pay-Later (BNPL) schemes… basically everyone paying cash/eftpos/credit is subsidising BNPL purchases.
No ones even mentioned the four letter C word.
Will do some tests and see if cash or eftpos is faster and post the resultsSome businesses are no longer accepting cash due to the costs of handling / security issues etc - a trend I can only see increasing.
If it saves then money, then maybe they shouldn't be charging it, if that is what they are doing. I don't think any company would charge extra for using cash, or if they are even allowed to do that. That would just be a normal cost of doing business. l The only benefit paywave has, over just using a card and pin, is that it allows payment from a phone or watch.
Can someone clarify this fee relates to pay wave not related to credit card per se so if you swipe or insert credit card there is no charge? Or this is credit card charge.
As I understand it, either way, the retailer is required to advise you either verbally, or with a notice, if your payment method attracts any charges on top of the sticker price.
I could be wrong though - I haven't actually read the legislation myself.
Correct. They must advise you of any additional charge to your payment method either verbally or with written notice.
Interestingly, a retailer can refuse to accept cash as a method of payment too except if it is for debt repayment.
If you owe them money then they must accept your cash.That's (at least one of) the definition(s) of legal tender I believe. Legal tender doesn't mean that anyone has to accept cash at the time a contract is formed, but if you owe someone a debt, and they refuse to accept legal tender in settlement of the debt, then, I seem to recall, the debt is extinguished.
Might want to check that with a a lawyer before relying on it though :-)
Most businesses will put up a sign, I notice most of them mention credit card instead of paywave, but the moment I see that sign (can be a very small piece of paper you can hardly notice), I'll just use cash/eftpos. Even reasonably big retailers like Reduced to Clear have started doing that. I'll only assume retail "giants" like Kmart, Bunnings, TWH, etc will absorb the fees now.
This is just a guess, but I suspect if you are big enough, you might get very good rates from the payment processors, and maybe flat rates, which means they would be indifferent between the various options.
this actually answers my question..
go to the video at 5:24
https://www.newshub.co.nz/home/money/2023/06/paddy-gower-has…the paywave fee and the same as the credit card fee, so you generally still pay the fee if you swipe your credit card with pin without paywave. the free option is only the debit card or EFTPOS.
hope this clarifies it.
Definitely paywave not sure about credit cards. The charge comes up on the little eftpos screen before you enter your digits if that helps
Just for clarity, for many stores there are multiple fees at different rates.
The better your negotiating skills and the more throughput, the better the rate will be.
A small store with minimal amounts will pay significantly more than the big guys.
To make matters worse, the fee can be split into multiple parts too.
But generally -
Visa / MC Paywave (Debit card) - smaller fee
Visa / MC credit card (paywave or inserted or swiped) - Slightly Higher
Unionpay - Can be similar to Visa/MC
Wechat pay / alipay - Similar again, if not slightly higher
Amex / Diners - Much higher.EFTPOS inserted / swiped - NO FEE other than the monthly costs that are usually fixed
The annoyong thing is the government bought in a new bill (https://www.mbie.govt.nz/#retail-payment-system-act-2022) that standardises interchange costs but there's been no decrease in businesses charging extra for credit card/paywave or a drop in the % of the fee for consumers. From that website:
The initial pricing standard came into force on 13 November 2022.
PB Tech had to lower their credit card % fee's as they are now only allowed to charge what it costs them. They had another % on top for themselves before this legislation.
Good to hear they're only allowed to pass on what it costs.
I'm really unsure how AirNZ get away with their CC fees.I just checked their site, doesn't seem crazy to me?
Picked two random domestic flights, $314 total, card fee $2.80 per flight or no fee with POLi.If my maths are right, sounds very reasonable at less than 1.8% - I would be happy to pay that to use a credit card with the benefits I would accrue from that payment method.
@MPC:
Given that is more than you feel is reasonable, what would you say would be a fair charge for offering payment via credit card?
@Jexla: Ah I didn't realise they reduced them as I got into the habit of using POLi with them. For cheaper fares e.g $70 it's closer to 4%. Will be interested to see what happens here with POLi Aus closing.
Sounds like a business opportunity to offer PayWave services for free (or even for a lower fee) and do something about it.
Let us know when you are up and running - I'm sure we will all support you :-)