Commerce Minister Kris Faafoi says he's closely watching the fees retailers are being charged to accept credit card payments.

Concerns about the fees have grown in recent years as contactless payments became more common.

More people are opting to use contactless debit cards in place of eftpos cards. 

But the problem for retailers has been that, until recently, contactless debit cards, which take money from a bank account in the same way as an eftpos card, were "bundled" with other payments and charged the same rates as credit cards.

By contrast, eftpos payments are virtually free for retailers.

RetailNZ chief executive Greg Harford said that had meant big bills for some shops.

The average fee charged for credit cards is 1.6 per cent but they can top 2 per cent. That compares to 0.8 per cent on average in Australia and 0.5 per cent in the United Kingdom.

In New Zealand, a typical contactless debit card payment costs 1.2 per cent, compared to 0.6 per cent in Australia and 0.2 per cent in the UK.

"The obvious difference between New Zealand and other markets is that we have eftpos which is a free service for the merchant and is not available to merchants in the UK and Australia," Harford said.

"The concerning thing for retailers has been that the trend has been to shift away from standard eftpos to contactless debit, driving substantial extra cost into the market.  Part of that is driven by the fact rate here are higher and also by the bundling."

He said some banks were now unbundling those debit payments and charging them at a lower rate but it would not be clear until more work was done next year whether that had affected the cost for retailers.

A spokesman for Faafoi said he had no plans to regulate the fees but had made it clear he did not want to see them increase any further.

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"He is keeping a close eye on these fees. e also wants to see more progress on opening up banking data to fintechs to allow innovative new payment services to develop."

But New Zealand Bankers' Association chief executive Roger Beaumont said it was important to compare like-for-like.

"Eftpos remains an important part of card payments in New Zealand. It's free for merchants and that impacts the overall cost to merchants for payments.  

"Here eftpos payments make up around two thirds of card payments. They make up around half the value of card payments. Australia's eftpos equivalent is offered at a cost per transaction to merchants and there is no equivalent in the UK," Beaumont said.

"Merchants need to make a decision about what's right for their business, considering both value and cost. For example, when considering value, research shows that merchants who offer contactless enjoy at least double the growth rates of merchants that don't.

"Another example is buy now pay later schemes, which can cost merchants up to 5 per cent of the transaction – significantly more than card payments – but are deemed valuable by many New Zealand merchants."

He said there was a lot of innovation happening in payments.

Banking expert Claire Matthews said it was likely that New Zealanders were paying too much for contactless payments but it was complicated to manage.

"Regulating to reduce these costs is likely to simply move them elsewhere in the market, so someone will end up paying but it may be hidden."

She said part of the fee was set by the card scheme, which banks could not reduce.