New credit card interchange fee caps could save Kiwi businesses money, and TAANZ is advising travel agencies to renegotiate their merchant agreements to secure the savings.
Travel agencies accepting Visa and Mastercard commercial credit cards could see lower payment costs from 22 Apr, when new interchange fee caps take effect, advises TAANZ ceo Julie White.
The Commerce Commission expects the changes to save businesses around $40 million annually, taking total savings from its card fee reforms to approximately $290 million a year.
Under the new caps, interchange fees on domestic commercial credit card transactions will fall from around 1.40% to a maximum of 0.50% for in-person payments and 0.90% for on-line transactions.
The changes are particularly relevant to travel agencies handling corporate and business travel bookings, which frequently involve commercial cards carrying some of the high est payment fees, adds White. For an agency processing $500,000 annually in domestic commercial card payments in person, interchange costs could fall from around $7000 to $2500 —a potential saving of $4500 a year.
However, agencies will not necessarily receive the full benefit automatically, cautions White. Under interchange-plus pricing, MSF fees are itemised separately, therefore the reductions should flow through to merchants. Agencies on blended pricing, where all (MSF) fees are combined into one rate, may need to renegotiate with their bank or payment provider to secure lower fees.
The merchant service fee comprises interchange, card network scheme fees and the acquirer’s margin. Only interchange is directly capped by the new changes.
TAANZ recommends that members check their merchant statements and ask providers how the new caps will affect their rates.
Agencies should also review whether savings from personal credit card fee changes introduced in Dec 2025 have been passed on, she adds.
