Small business yesterday appealed for a cap on billions’ worth of credit card fees charged retailers. The Department of Finance for more than a decade has permitted Visa and MasterCard to set their own rates under a voluntary Code Of Conduct, according to Blacklock's Reporter..“Small firms aren’t able to negotiate lower interchange rates on their own,” Dan Kelly, CEO of the Canadian Federation of Independent Business, said in a statement. “Ensuring smaller merchants can access lower rates including for e-commerce is key to relieving some cost pressures.”.The Federation proposed a maximum 1% cap on transaction fees that currently range up to three percent. The Department of Finance in 2010 promoted a voluntary code for credit card issuers, then held 2021 consultations on federal regulations. None have been introduced to date. Credit card fees are worth more than $5 billion a year, by official estimate..Gary Sands, senior vice-president of the Canadian Federation of Independent Grocers, testified Monday at the Commons agriculture committee that fees ate narrow profit margins. “The independent grocer is on a margin of about two percent,” said Sands..“Those fees have a disproportionate impact on the narrow margin sector like retail grocery, particularly for independent grocers who pay higher fees than other large businesses,” testified Sands. “Those fees do have an impact on food affordability. I would urge the government to look at establishing one lower interchange fee for any and all grocers for their customers where they use a credit card to purchase food.”.Walmart in 2016 obtained lower fees after threatening to suspend all Visa transactions at its Canadian outlets. The retailer at the time estimated it paid $100 million a year in transaction fees on all credit cards..MPs and senators have repeatedly tried and failed to pass private bills to regulate credit card fees. The last bill C-243 An Act To Amend The Payment Card Networks Act lapsed in the 43rd Parliament..“Who do we work for?” said Bloc Québécois MP Alexis Brunelle-Duceppe (Lac-Saint-Jean, Que.), sponsor of the bill. “The answer is simple. We work for the people including those who run a business.”.Visa and MasterCard in 2013 won a Competition Tribunal ruling that dismissed allegations the two companies breached the Competition Act on fees. Storekeepers also complained of “anti-competitive restraints” including a no-surcharge rule that prevented merchants from recouping Visa and MasterCard fees at checkout..“Merchants have the ability to decide whether or not they wish to participate in the Visa system,” Visa Canada Corporation wrote in a 2011 filing with the Tribunal.
Small business yesterday appealed for a cap on billions’ worth of credit card fees charged retailers. The Department of Finance for more than a decade has permitted Visa and MasterCard to set their own rates under a voluntary Code Of Conduct, according to Blacklock's Reporter..“Small firms aren’t able to negotiate lower interchange rates on their own,” Dan Kelly, CEO of the Canadian Federation of Independent Business, said in a statement. “Ensuring smaller merchants can access lower rates including for e-commerce is key to relieving some cost pressures.”.The Federation proposed a maximum 1% cap on transaction fees that currently range up to three percent. The Department of Finance in 2010 promoted a voluntary code for credit card issuers, then held 2021 consultations on federal regulations. None have been introduced to date. Credit card fees are worth more than $5 billion a year, by official estimate..Gary Sands, senior vice-president of the Canadian Federation of Independent Grocers, testified Monday at the Commons agriculture committee that fees ate narrow profit margins. “The independent grocer is on a margin of about two percent,” said Sands..“Those fees have a disproportionate impact on the narrow margin sector like retail grocery, particularly for independent grocers who pay higher fees than other large businesses,” testified Sands. “Those fees do have an impact on food affordability. I would urge the government to look at establishing one lower interchange fee for any and all grocers for their customers where they use a credit card to purchase food.”.Walmart in 2016 obtained lower fees after threatening to suspend all Visa transactions at its Canadian outlets. The retailer at the time estimated it paid $100 million a year in transaction fees on all credit cards..MPs and senators have repeatedly tried and failed to pass private bills to regulate credit card fees. The last bill C-243 An Act To Amend The Payment Card Networks Act lapsed in the 43rd Parliament..“Who do we work for?” said Bloc Québécois MP Alexis Brunelle-Duceppe (Lac-Saint-Jean, Que.), sponsor of the bill. “The answer is simple. We work for the people including those who run a business.”.Visa and MasterCard in 2013 won a Competition Tribunal ruling that dismissed allegations the two companies breached the Competition Act on fees. Storekeepers also complained of “anti-competitive restraints” including a no-surcharge rule that prevented merchants from recouping Visa and MasterCard fees at checkout..“Merchants have the ability to decide whether or not they wish to participate in the Visa system,” Visa Canada Corporation wrote in a 2011 filing with the Tribunal.
