The fees credit cards charge merchants in Canada will be reviewed.
That coming from the Finance Minister, Bill Morneau, who put out a statement Wednesday.
“In order to ensure that there is, in fact, adequate competition and transparency for Canadian businesses and consumers when it comes to the fees they incur when using credit cards, the Government will conduct a further assessment of the fees charged by credit card networks and review the effects of the fee reductions.”
It comes just hours after both VISA and Mastercard confirmed they had hired auditors which found them to be adhering to a promise made a couple of years ago, to voluntarily reduce their fees.
The Retail Council of Canada says it’s encouraged by Morneau’s commitment, since credit card interchange fees are far too high, “with the credit card duopoly charging merchants in Canada – and ultimately Canadian consumers – five times what they charge in other markets for the same services.”
“These excessive interchange rates mean that Canadian consumers pay at least $4.5 billion more for all credit purchases each year than they would if our rates were comparable to those in the EU. At the current 1.50% average rate, over the four remaining years of the voluntary agreement, Canadians will pay at least $18 billion more than they should.” – Karl Littler, Vice President of Public Affairs at Retail Council of Canada.
Meantime, Walmart announced on Thursday, that as of October 24, it would no longer be accepting VISA cards at its Manitoba stores.
The credit card company and retailer remain embattled in a feud over merchant fees.
Walmart has said it pays more than $100 million in annual fees; VISA maintains if had offered the chain one of the lowest rates in Canada.
Earlier this summer, Walmart announced it would phase out the acceptance of VISA cards at all 400 of its stores across the country.