National Australia Bank faces a backlash from small business groups, politicians and business account holders after confirming it plans to levy fees on real time transactions conducted through the New Payments Platform.The bank has notified business customers across Australia that it will impose a fee of 40 cents on every real time transaction they execute via the NAB Connect internet banking site.The new fee will be imposed on all business customers who use the NAB Connect website to initiate Osko payments with a PayID.NAB is marketing Osko transactions and other real time payments going through the NPP as a "premium service" to its business customers."Customers using NAB Connect will have the choice to make overnight payments, or fast payments via the NPP," a NAB spokesperson said."As a premium service, a fee will apply to fast payments made via NAB Connect from 1 May 2018."NAB is currently waiving this fee, and NAB Connect customers are encouraged to contact their banker to discuss their fee arrangements and pricing packages."The new transaction fee is controversial, partly because retail customers do not pay fees on Osko transactions.This raises the prospect that NAB will use the fee imposed on business customers to subsidise the costs of providing real time payments to other users.The fee might also be difficult to justify given that the NPP has not yet set the wholesale transaction fees it will levy on 13 participant banks (including NAB) for using the platform."NPP Australia's wholesale price per transaction to its participants will commence in the 2018/19 financial year and has not yet been determined," a NPP spokesperson told Banking Day."Pricing for NPP services to their customers is at the discretion of participating financial institutions and is likely to vary for different market segments."Given the platform provides a place for financial institutions to compete, we expect participants will be focused on delivering what their customers want and in line with market conditions." The problem for NAB is that it cannot point to a publicly known cost base to defend charging a fee of 40 cents each time a business customer executes a real time payment.That's because the NPP hasn't set the wholesale fee.Several banking industry sources have told Banking Day in the last week that the NPP is likely to set the wholesale fee at around 10 cents per transaction.If that speculation is found to be accurate the bank faces losing a swathe of business customers who might reasonably conclude they are being gouged by the 40-cent impost.NAB is the country's leading lender to small and medium enterprises and accounts for the largest share of banking relationships in the retail sector.However, Australian Retailers Association CEO Russell Zimmerman said the bank shouldn't count on retail businesses wearing the fee."Retail businesses are under pressure in a very challenging market environment," he said."The bank should understand that retailers will not take kindly to this new fee and they will naturally look to other providers."Other major banks were guarded in their responses to questions from Banking Day on