Canadian businesses will be permitted to apply surcharges when accepting credit cards, effective Thursday. .Credit Card Class Actions said in a Wednesday statement the change is being made after class action lawsuits against credit card companies determined surcharges were fair. .The statement said Canadian businesses cannot apply surcharges before Thursday. It said if businesses intend to add a surcharge, they should comply with all Visa and Mastercard rules on surcharging. .The statement went on to say Visa and Mastercard require businesses to provide written notice of their intentions to surcharge. It added for merchants accepting Visa credit cards, merchants must notify their acquirers in writing at least 30 days before announcing their intentions to impose surcharges or before enacting them. .It said if businesses intend on applying a surcharge on Mastercard credit cards, they must notify the company and their acquirer at least 30 days before. .Visa and Mastercard rules require businesses who intend to surcharge to disclose it to their customers and state it's being applied by them, rather than a credit card company. .The Visa and Mastercard rules place a cap on the surcharge businesses can apply. A merchant cannot surcharge customers more than it costs the merchant to accept credit cards, and the surcharge cannot be more than any applied to other competing credit cards or PayPal..The Canadian government was looking at setting up the country’s first laws on credit card swipe fees in 2021. .READ MORE: Feds to clamp down on credit card swipe fees, payday loans.This move would coincide with cabinet looking at rewriting usury law from 1978 regulating interest rates on payday loans..“Many lower and modest-income Canadians rely on high interest, short term loans to make ends meet such as paying for everyday living expenses or for unanticipated emergencies,” said Finance Minister Chrystia Freeland.
Canadian businesses will be permitted to apply surcharges when accepting credit cards, effective Thursday. .Credit Card Class Actions said in a Wednesday statement the change is being made after class action lawsuits against credit card companies determined surcharges were fair. .The statement said Canadian businesses cannot apply surcharges before Thursday. It said if businesses intend to add a surcharge, they should comply with all Visa and Mastercard rules on surcharging. .The statement went on to say Visa and Mastercard require businesses to provide written notice of their intentions to surcharge. It added for merchants accepting Visa credit cards, merchants must notify their acquirers in writing at least 30 days before announcing their intentions to impose surcharges or before enacting them. .It said if businesses intend on applying a surcharge on Mastercard credit cards, they must notify the company and their acquirer at least 30 days before. .Visa and Mastercard rules require businesses who intend to surcharge to disclose it to their customers and state it's being applied by them, rather than a credit card company. .The Visa and Mastercard rules place a cap on the surcharge businesses can apply. A merchant cannot surcharge customers more than it costs the merchant to accept credit cards, and the surcharge cannot be more than any applied to other competing credit cards or PayPal..The Canadian government was looking at setting up the country’s first laws on credit card swipe fees in 2021. .READ MORE: Feds to clamp down on credit card swipe fees, payday loans.This move would coincide with cabinet looking at rewriting usury law from 1978 regulating interest rates on payday loans..“Many lower and modest-income Canadians rely on high interest, short term loans to make ends meet such as paying for everyday living expenses or for unanticipated emergencies,” said Finance Minister Chrystia Freeland.
