But disgruntled shop owners have labelled the proposal a "band-aid solution" and insist it will do little to draw customers back to the troubled CBD.

Wollongong City Council is calling for public feedback on a plan to dispense with the flat fee in favour of a pro rata system which would allow shoppers to pay less money for less time.

Motorists would pay a minimum of 40 cents and a maximum of $2 to park in the city centre, depending on the length of their stay.

The maximum time limits and charges in one, two and three-hour spaces will not change, however 30-minute stays will now cost $1.50 - a saving of 50 cents

The backflip comes after community feedback showed people resented being slugged $2 for parking when buying a coffee or using an ATM.

The council's general manager David Farmer said most residents accepted the concept of a paid parking system but were reluctant to fork out for shorter stays.

"The proposed pro rata rate means motorists can put coins into the machine depending on the amount of time they want to stop," he said. "For example, (it will cost) 40 cents to pick up the dry cleaning in a 30-minute space, or $3 to visit the accountant in a four-hour off-street car park."

The council has reaped more than $500,000 from parking meter fees since the system was introduced in March. A move to a pro rata rate is expected to cut revenue by 20 per cent.

But the change failed to placate angry shopkeepers who have reported a sharp drop in trade since paid parking began.

Gala Trophies co-owner Diana Leyshon said the move would only help those on short shopping trips.

"It might make people park if they're just going to be quick, but people still won't like it," Ms Leyshon said. "But business owners and shoppers are still being punished - it's just a band-aid over the problem."

City Diggers general manager Phil Ryan, a vocal critic of the parking meter strategy, said most shoppers would see little advantage in the new plan.

"For people who want to come in for a one-hour or two-hour trip, there's not much difference - fees haven't decreased at all," he said.

"I don't think it's an attractive enough reason for people to come back into town."

He said the complex new charges, which charge different rates in different time zones, would create mass confusion.

The proposal is on public exhibition until August 3.