Canadian retail organizations are urging Ottawa to create a stronger code of conduct for the credit card industry that would ensure merchants aren’t stuck with transaction costs when they accept Visa and MasterCard.
The Canadian Federation of Independent Business said Tuesday that it is calling for new rules that give merchants more flexibility in what they accept at their cash registers.
The group, which has more than 100,000 member businesses across Canada, wants changes to the federally regulated code that would allow retailers the right to refuse high-cost cards at their stores.
The CFIB also wants the ability for merchants to add limited surcharges that would counteract the transaction fees charged by some credit card companies when customers swipe their higher-end credit cards, which rack up points that can be used for travel or other bonuses.
“Merchants have had a 30-per-cent increase in their costs in the last two years because of premium [credit] cards,” Dan Kelly, the president and chief executive officer of the CFIB, said in an interview.
“Those additional costs are finding their way into their service. Consumers are paying these fees already, and they’re going up.”
The association is among those arguing against industry rules that force businesses who accept Visa or MasterCard to treat all types of their cards equally, regardless of the cost of processing the payments.
The issue has been of concern to the Competition Bureau, which argued in May that restrictive contracts put in place by Visa and MasterCard allow the two credit card companies – which represent 92 per cent of the market – to essentially dictate terms to merchants.
To read the full article click here – David Friend – The Canadian Press for Globe and Mail – July 17, 2012