Pressure is mounting on the banks to drop the fees they charge merchants for contactless payments in a bid to encourage more to sign up for the service which would mean fewer people having to touch keypads.

Greg Harford, chief executive of Retail New Zealand, this morning joined Mark Rushworth, Lance Wiggs, Dean Hall and other entrepreneurs calling for the fees to be removed during the pandemic.

Harford told Newstalk ZB this morning the World Health Organisation had backed contactless as a good idea to avoid people getting sick amid the coronavirus outbreak.

"Contactless technology means you are not exposing yourself to as many germs."

But he said many retailers still don't offer the service because of concerns over cost.

"There is a perception of cost. Sometimes that is more perception than reality. But we are certainly encouraging retailers to look closely at their costs."

Harford said on average merchants paid around 1.1 per cent to 1.2 per cent of each transaction for contactless payments.

'Which doesn't sound like a lot but when you operate in an environment where the average net margin is only 3.6 per cent it adds up."

Harford said it was the banks which set the merchant fees.

"Ultimately it is down to them and how much money they are seeking to recover from customers."

Retail New Zealand had also been calling for more transparency on the fees for some time.