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New Digital Payment App Promises Lower Fees for NZ Merchants

Expert Briefing

Tuesday 29 October 2024, 9:55AM

By Expert Briefing

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A new digital payment platform launching in New Zealand aims to slash merchant fees and streamline payment processing through open banking technology.

Payap, developed by New Zealand fintech company Centrapay and backed by Bank of New Zealand (BNZ), will offer businesses a 0.39% payment acceptance rate for in-store transactions and 0.59% for online payments. These rates represent significant savings compared to current market rates, which average around 1% according to Commerce Commission data.

The platform, set to launch for consumers in March 2025, will allow users to make payments by scanning QR codes at existing EFTPOS terminals, drawing funds directly from their bank accounts.

"Payap is the country's first comprehensive digital payment service that leverages the power of open banking to fill a clear gap in the New Zealand market," Centrapay CEO Greg Beehre said.

The app will integrate with all major New Zealand banks and include features such as loyalty program management, digital receipts and bill-splitting capabilities. Merchants can use their existing EFTPOS hardware with the system.

BNZ Executive Customer Products and Services Karna Luke said the bank expects thousands of businesses to adopt the platform before the consumer launch.

"We're working closely with our business customers to onboard them before the consumer launch," Luke said. "Payap is designed to benefit businesses across Aotearoa, from small street vendors to enterprise retailers."

A retail business processing $100,000 monthly could save up to $7,320 annually using Payap compared to current average merchant fees, according to company projections.

Business registration is now open, with additional features like peer-to-peer payments planned for rollout throughout 2025.