By Kate Harvey
Content Manager | Pou Whakahaere Ihirangi
Wild South, a clothing store, has lowered its surcharge rates for credit card payments and contactless debit card payments after we told the store we thought it was too high.
Payment surcharges are used by businesses to recover the costs of accepting payments made by credit cards and contactless debit cards, but they’re meant to reflect the actual cost to the business.
We received several complaints about Wild South’s 3% surcharge, so we asked the company what it actually pays for accepting card payments. A Wild South representative said the charge was between 1% and 2.7% depending on the type of card used and that, upon review, the 2.7% charge was for “a lower portion of our sales”.
Our consumer advocate Aneleise Gawn pointed Symon in the direction of the Commerce Commission’s advice around surcharging.
“The Commission says surcharges should not exceed the cost of accepting the payment and has advised that credit card surcharges should not exceed 2%, so 3% is highly likely to be excessive,” she wrote.
Wild South agreed to review its surcharge and has since told us it’s now 2%.
Aneleise said many customers have cottoned on to what surcharges are acceptable and what’s excessive when paying with a credit or contactless debit card. She’s received over 100 complaints so far this year about excessive surcharges ranging from 2.5% to 20% and covering a wide range of merchants.
“If anyone comes across a merchant charging more than 2%, let us know or lodge a complaint with the Commission,” she said.
“And remember, merchants should tell you about the surcharge upfront and should also provide a payment method that allows you to avoid the surcharge altogether, such as EFTPOS, inserting your debit card or online banking.”
The Commission is currently exploring ways to reduce the costs associated with credit and debit card payments in New Zealand.
Your wins
One of the things we’re most proud of is when we can help our members get a fair deal. Here are some of the recent times we've helped people deal with their consumer issues.
