BNZ’s Payap Offers Businesses A Way Forward As Government Moves To Ban Payment Surcharges

The government’s announcement today that it will ban payment surcharges could save New Zealand consumers up to $150 million annually – and BNZ’s Payap app, launching to consumers next month, offers businesses a way to thrive under the changes by cutting their payment acceptance costs.

The ban, expected to be in place by May next year, will prohibit businesses from adding surcharges to instore card payments. This improves pricing transparency for consumers, but it means businesses will need to absorb payment processing costs that currently average 1% of transaction values, according to the Commerce Commission.

Payap provides a lower-cost alternative with transaction fees of just 0.39% or 0.59% and no monthly fixed fees. It is compatible with all major New Zealand banks and uses open banking technology to provide secure, direct account-to-account transfers.

“The surcharge ban gives New Zealanders transparent pricing for card payments, and Payap takes that further by offering them a free, convenient way to pay without needing to carry cards at all,” says BNZ Executive Customer Products and Services Karna Luke.

“But we’re going further – we’re helping businesses reduce their payment acceptance costs. When surcharges disappear, businesses using Payap will have a cost advantage.”

Payap works through QR codes dynamically generated on EFTPOS terminals, with customers scanning the codes through the app to make payments directly from their bank accounts. The technology works with leading terminal providers across New Zealand, requiring no new hardware for most merchants while offering bank-grade security.

“Smart businesses are already preparing for a surcharge-free future,” says Luke.

“Payap gives them a competitive advantage through lower costs and better customer experience.”

The consumer app launch follows a soft launch period focused on business onboarding, with thousands of businesses set to accept Payap payments when consumers gain access next month. Additional features including gift card support, loyalty programmes, and peer-to-peer payments will be rolled out progressively throughout 2026.

For more information, visit payap.com.

Note:

Payap has an in-store payment processing fee of 0.39% when a merchant processes less than $300,000 per annum in net sales through Payap or settles to a BNZ bank account. If a merchant processes $300,000 or more per annum in net sales through Payap and settles to a non-BNZ bank account, an in-store payment processing fee of 0.59% of the value of net sales will apply. 

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