Source: Radio New Zealand
By reducing the number of interest-free days, banks reduce their costs says Consumer NZ. 123RF
BNZ has reduced the number of interest-free days available on two of its credit cards, in response to new interchange fee rules.
When credit cardholders clear their balance each month, there is a period of time in which new purchases on the card are interest-free.
This has typically been up to 55 days.
But BNZ said in February it reduced two of its cards to 44 days. The BNZ Lite Visa retains its 55 days.
“With new interchange fee regulations introduced in December, BNZ opted to review its credit card and rewards offerings to ensure they remain fit for purpose now and in the future.
“As part of this review, we surveyed credit card holders from across the country about their credit card priorities and preferences. The findings were clear, with rewards and points programmes cited as the most important feature when choosing a credit card, while increases to annual fees was cited as the top concern.
“We used this data to help guide targeted changes to ensure we continue to provide value to our customers in the areas they care most about – such as retaining rewards and avoiding increased annual card fees – while supporting the long-term sustainability of the programme.”
Interchange fees are charged when transactions are processed on a credit card. The Commerce Commission has been concerned they were too high and said its new settings, which lower what can be charged, should save businesses $500 a year on average.
Consumer NZ spokesperson Jessica Walker said banks were earning less money as a result of the new rules and would be rethinking benefits.
“Interest free days are effectively a cost to the banks, so by reducing the number of days, they reduce their costs and increase their chances of making interest off customers.”
But she said, at the same time, many businesses were still charging customers surcharges at a level set before the fees dropped. Shoppers had not yet received the benefit of the reduction.
“Without a surcharge ban, consumers face a dual burden: excessive and unavoidable surcharges at the point of sale as well as reduced card benefits following interchange reductions. When interchange fees were reduced in December 2025, businesses costs to accept card payments were reduced. It was estimated that businesses would save around $90 million a year. We are concerned that those promised savings are not always passed through by retailers. This is an issue that needs addressing.”
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