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John Small: Commerce Commission chair on the company's plan to regulate PayWave and online card payments · Best of Business

• 0:09
  Speaker 1: You're listening to a podcast from News Talks be follow
• 0:12
  Speaker 1: this and our wide range of podcast now on iHeartRadio Afternoon.
• 0:17
  Speaker 2: The Commerce Commission has taken the first step towards putting
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  Speaker 2: a cap on what you pay to use your credit
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  Speaker 2: card as a pay wave card. They reckon, we are
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  Speaker 2: paying too much for the privilege, about a billion dollars
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  Speaker 2: a year, and the ComCom has started consultation about regulating
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  Speaker 2: that amount. John Small is the chairman of the Commos
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  Speaker 2: Commission with us. Now, Hey, John, hei he how are
• 0:34
  Speaker 2: you doing very well? Thank you?
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  Speaker 1: Now?
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  Speaker 2: Am I right in thinking you want to take the
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  Speaker 2: surcharge down from about an average of two point five
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  Speaker 2: percent to zero point seven percent?
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  Speaker 3: Yeah, that's pretty much the strength of it, that's right. Yes,
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  Speaker 3: we think that that's doable, and we think it'll be
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  Speaker 3: pretty beneficial in lots of ways.
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  Speaker 2: If you are successful in being able to regulate this.
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  Speaker 2: Does this mean, for example, that if you go to
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  Speaker 2: pay your parking and it's three dollars and you're going
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  Speaker 2: to tap your card, you no longer pay a fifty
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  Speaker 2: cents charge for tapping your card. You only pay zero
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  Speaker 2: point seven percent.
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  Speaker 3: That's what it should be. It's that zero point seven percent,
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  Speaker 3: some merchants will say why bother, and that would be
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  Speaker 3: a good outcome. The reason we're saying zero point seven
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  Speaker 3: percent is a part of what we're doing here, Heather
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  Speaker 3: as trying to simplify these rates so that the merchants
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  Speaker 3: know much more clearly what they're what it's costing them,
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  Speaker 3: and then that allows us as buyers to also know that.
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  Speaker 3: So if you see, under this new new world, if
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  Speaker 3: consultation goes the way that we kind of hope it will,
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  Speaker 3: then people will be able to expect to not ever
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  Speaker 3: pay more than point seven if they are too.
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  Speaker 2: Point seven percent of paying three dollars for your parking
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  Speaker 2: is not even one cent. So if they're charging us
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  Speaker 2: fifty cent, are they ripping us off?
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  Speaker 3: Well, these search charges that we're seeing at the moment,
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  Speaker 3: a lot of them are well above cost. But part
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  Speaker 3: of the problem is is that you and I don't
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  Speaker 3: actually know what their cost is, and sometimes they don't either.
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  Speaker 2: How much more are they charging us in New Zealand
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  Speaker 2: and they're charging overseas this is Visa and MasterCard.
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  Speaker 3: Well, you know in New Zealand's interchange this is an
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  Speaker 3: interchange fee that we're talking about pushing down. You know,
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  Speaker 3: ours are sort of higher than some and lower than
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  Speaker 3: others basically around the world. But we're looking at the
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  Speaker 3: UK and in Europe where and benchmarking fees against them.
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  Speaker 3: They seem to be able to maintain perfectly viable payment networks,
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  Speaker 3: and so that's the kind of benchmark that we're looking at.
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  Speaker 3: But you know, as you know, there've been much higher
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  Speaker 3: rates than that in New Zealand and elsewhere.
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  Speaker 2: Yeah, and if you are able to introduce this cap,
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  Speaker 2: would this include capping online fees that you pay for
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  Speaker 2: your credit card, like, for example, when you pay for
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  Speaker 2: the New Zealand.
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  Speaker 3: We yes, it will be. It's designed to be very universal.
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  Speaker 3: So as I say, we're in consultation at the moment.
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  Speaker 3: We'll see what people have got to say. Some people
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  Speaker 3: might tell us it's terrible idea because of this or
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  Speaker 3: that unexpected you unintended consequence. We'll have a look at
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  Speaker 3: all that. But that's definitely where we're hitting, all right.
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  Speaker 2: I know you want the retailers to absorb the stuff
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  Speaker 2: if it gets low enough. Do you think they will learn?
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  Speaker 3: Hard to know, But I mean I think either way
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  Speaker 3: it's not going to matter too much. If there's a
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  Speaker 3: clear expectation, and it's such a low number as zero
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  Speaker 3: point seven, then you know it's not as you say,
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  Speaker 3: it's only going to be a few cents on a
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  Speaker 3: small purchase. So for them it might be a wide
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  Speaker 3: bother and for us it's you know, just not much. Hopefully, John.
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  Speaker 2: I'm into this. I want to see you do this.
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  Speaker 2: So how long do I have to wait?
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  Speaker 3: Good question. We've got the we've got the consultation open
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  Speaker 3: for I think a couple of weeks or maybe a
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  Speaker 3: bit longer. The good news is that the Commission has
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  Speaker 3: the power to do this, so we don't have to
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  Speaker 3: go to a court or persuade a minister or anything
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  Speaker 3: like that. So we'll see, we'll see what comes back
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  Speaker 3: in the in the replies, and then have a good
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  Speaker 3: hard point about it internally and make our call good stuff.
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  Speaker 2: Really appreciate your time, John, that's John Small, Commerce Commission Chairman.
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