RUC on Rails Responds to Ministry of Transport RUC Market RFI
On 11 February 2026, RUC on Rails responded to the Ministry of Transport’s RUC market RFI, outlining our plans for consumer access, retail distribution, privacy, competition, and the transition to universal RUC.
Today, RUC on Rails submitted its response to the Ministry of Transport’s Request for Information on future Road User Charges services for vehicle owners.
The RFI seeks input from prospective market participants on how New Zealand’s future RUC system could operate, including the services providers may offer, the technology they could use, barriers to competition, customer needs, and the eventual transition of petrol vehicles from fuel excise duty to RUC.
Our response sets out how RUC on Rails intends to participate in the future consumer RUC market and the conditions we believe will be necessary for that market to work properly.
“We believe the future RUC market needs to be designed around how ordinary New Zealanders actually manage transport costs,” says Adam Johnston, CEO of RUC on Rails.
“That means giving people simple digital options, but also supporting those who prefer to pay in person, use cash, speak to someone on the phone, or avoid vehicle tracking technology altogether.”
Our proposed RUC services
The response outlines our developing portfolio of consumer-facing RUC products and services.
These include tools that help drivers determine whether their vehicle is subject to RUC, understand likely costs, compare future providers, and access plain-language information about the changing system.
It also introduces our proposed retail services, including RUC Pass, an over-the-counter purchasing model designed for people who prefer assisted or in-person transactions.
Our response explains that future RUC services should support a broad range of users, including:
Low-mileage and budget-conscious drivers.
Rural vehicle owners with limited digital access.
People without smartphones.
Privacy-conscious drivers who do not want mandatory GPS or telematics.
Small businesses managing light vehicle fleets.
Drivers who prefer flexible, pay-as-you-go purchasing.
Rather than forcing every driver into one technical model, we believe the market should support multiple ways to comply.
A privacy-first approach to RUC technology
Our response confirms that we do not intend to require GPS tracking or in-vehicle hardware as part of our proposed consumer services.
RUC on Rails has researched and tested non-GPS distance measurement using vehicle diagnostic data. However, our research identified significant cost, trust, and privacy barriers associated with requiring consumers to install hardware in their vehicles.
For that reason, our current approach prioritises mobile and web services, retail integrations, assisted purchasing, and minimal data collection.
“We have proven that privacy-preserving distance measurement can be technically possible,” says Johnston.
“But technical possibility does not automatically make something commercially sensible or socially acceptable. Consumers should not be forced to install tracking-adjacent hardware simply because the technology exists.”
Barriers to a competitive RUC market
The response also identifies several barriers that could prevent meaningful competition from developing.
A major concern is the suspension of new access to important NZTA interfaces and approval pathways used to build and test RUC services.
Without access to the same systems available to incumbents, new providers cannot properly validate integrations, demonstrate readiness, or prepare for the future market.
We also raised concerns about fragmented government information, significant upfront compliance costs, limited access to startup capital, and uncertainty around NZTA’s future role as both regulator and potential retail participant.
We support NZTA remaining available as a provider of last resort. However, we believe clearer separation will be needed between its regulatory responsibilities and any continuing retail activity once the private market opens.
Supporting the transition from fuel excise to universal RUC
The response argues that the greatest challenge in moving petrol vehicles to RUC will not be the underlying technology.
It will be helping millions of drivers understand a completely different way of paying for road use.
Petrol drivers currently pay fuel excise automatically when purchasing fuel. Under universal RUC, those drivers will need to actively understand, purchase, and maintain road user charges for the first time.
We believe the transition will require clear national communication, familiar payment channels, simple calculators and eligibility tools, physical retail access, and support for drivers who are digitally excluded.
Our response recommends a clear and time-limited transition window rather than a prolonged or uncertain phase-in. A defined period of approximately 30 days would reduce confusion, limit double-charging concerns, and provide a clear point at which obligations begin.
The hidden cost of payment processing
We also highlighted a major commercial issue for future RUC providers: standard payment processing fees are applied to the entire value of a transaction, even though most of that money is Crown revenue being passed through to government.
For example, a $100 RUC purchase processed through standard card infrastructure may attract a fee based on the full $100, not merely the provider’s small commercial margin.
This could unnecessarily increase the cost paid by drivers and make small, flexible RUC purchases commercially difficult to offer.
Our response asks the Government to consider alternative payment rails, negotiated processing arrangements, or other mechanisms that recognise the unique pass-through nature of RUC transactions.
What happens next
The Ministry of Transport will use RFI responses from prospective providers and other market participants to inform the policy, regulatory, and technical settings for greater private-sector delivery of RUC services.
RUC on Rails has confirmed that we are available to provide further information and participate in future discussions as the model develops.
Our full response to RFI 33070980 was submitted on 11 February 2026.
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