Retail Council of Canada says it has been the main advocate for a regulated solution to the credit card fee problem and welcomes this opportunity to shine a light on the multi-billion dollar costs imposed on all Canadians, including merchants, by Visa and MasterCard. Simply put, credit card interchange fees are far too high, with…
March consumer revolving credit card debt (RCC) soared at an annual rate of +14.2%, compared to +3.7%% in February and -0.3% in January. Overall consumer credit increased at a seasonally adjusted annual rate of +10.8% in March. Non-revolving credit increased at an annual rate of +8.5%. Total revolving credit for March posted at $951.6 billion,…
Retail Council of Canada (RCC) has renewed its exclusive agreement with Chase Paymentech as its provider of payment processing solutions to RCC’s membership of more than 45,000 store fronts. RCC members can access new preferred credit and debit card processing rates, emerging products and industry expertise from Chase Paymentech. Advantages to RCC members processing with Chase Paymentech offer exclusive Interac, VISA and MasterCard rates; consultation with a Chase Paymentech merchant services provider that understands unique retail-specific payment needs; and simplified payments with one provider and one statement for Visa, MasterCard and Interac transactions.
The Retail Council of Canada (RCC) released its report card on credit and debit card industry practices. The report indicates 80% of respondents indicated that their merchant discount rates have either increased or remained the same over the past 12 months; 57% of respondents have seen an increase in premium card use in their stores over the past 12 months; 54% of respondents indicate the disclosure on their monthly merchant statements has remained unchanged since the introduction of the Code; 64% of respondents have not received any notification from their acquirer/processor that they have the right to cancel their current contracts with no penalties once receiving notification of a fee increase; and 80% of respondents believe they will receive no real benefit from switching acquirers/processors if they choose to cancel their current contract. These findings were concluded at the one-year anniversary of Finance Canada’s introduction of the Code of Conduct for Credit and Debit Card Industry in Canada.
The Payments Accountability Council (PAC), led by Retail Council of Canada (RCC), the Canadian Council of Grocery Distributors (CCGD) and backed by more than 250,000 Canadian merchants, applauds Finance Minister Flaherty and the Government of Canada for the announcement of a code of conduct for the Canadian debit and credit markets. Though merchants understand the government’s push for voluntary measures as a first step, the PAC advocated for, and supports the inclusion of powers to regulate the market in light of card company practices seen in other countries around the world. The PAC remains focused on the need to provide clarity; the need to provide merchants with effective tools to manage payment card costs; and the need to ensure that the costs built into the system through loyalty and other programs are paid for by those who introduce and benefit from these costs.
The Payments Accountability Council (PAC)
applauds government’s efforts to bring clarity, transparency and
merchant choice to the debit and credit card market in Canada through
the Government of Canada’s Code of Conduct for Credit and Debit Card
Markets. PAC’s review and commentary is based on three key principles: the need to provide clarity for consumers and merchants;
the need to provide merchants with effective tools to manage costs associated with debit and
credit cards and the need to ensure that the costs built into the system through
loyalty and other programs are paid for by those who introduce and
benefit from these costs. PAC members will continue to advocate for flat merchant fees for debit
card transactions, the elimination of higher merchant fees for premium
credit card transactions, real competition for merchant acceptance and a formal
stakeholder-driven rules-based oversight mechanism for all elements of the
Canadian payments system.
Retail Council of Canada (RCC), The Canadian Council of Grocery
Distributors (CCGD) and the StopStickingItToUs Coalition have commended
Finance Minister Flaherty and the Government of Canada for the
introduction of a Code of Conduct governing the Canadian debit and
credit card markets. The Code is designed to ensure merchant choice,
enhanced competition and greater transparency in a marketplace dominated
by only a few large companies. In response, the RCC, CCGD and its
Coalition partners have established the Payments Accountability Council
(PAC) to provide input to the consultation process and report on
compliance with the Code. The Code allows merchants to choose the least
expensive method for processing on each transaction and to have complete
choice on which credit and/or debit products to, or not to, offer.
The StopStickingItToUs Coalition, representing over 250,000 Canadian
merchant businesses, is commending the Standing Senate Committee on
Banking, Trade and Commerce for its report recommending fundamental
changes to Canadian card issuers and processor operations, namely the
fees and rates charged to merchants and consumers. Recommendations for
credit processing include the appointment of an “oversight board” within
with a mandate to make recommendations; to establish a code of conduct
for payments systems participants and setting fees; to prohibit any
“honour all cards” rules; and to permit surcharging and/or discounting
by merchants. Meanwhile, recommendations for debit card processing
include the calculation of switch and interchange fees on a flat fee;
an interchange fee of zero for 3 years; no percentage fees; to prohibit
priority routing; and to promote the efficiency and competitiveness of
payment systems across the country.
Alternative payment provider MyECheck has signed Wealthworld and Alternative Info Solutions to its software suite.
Alternative Info Solutions is a provider of home study marketing courses and
Wealthworld is a financial training company that teaches its customers how to get out of debt, repair their credit and start to build real wealth through products, services and seminars. MyECheck utilizes a proprietary, patented method of creating and clearing remotely created checks. eChecks processed on the MyECheck system are typically accepted in 1 to 3 seconds and clear the same day or overnight compared to typical Automatic Clearing House System (ACH) time frames of 3 to 5 days. MyECheck provides the most viable alternative to credit cards enabling conversion of declined transactions or
customers without credit cards.
The representatives of Canadian businesses will descend on Ottawa for
the start of House of Commons joint House Finance/Industry Committee
inquiry focused on the fees merchants are forced
to pay to accept credit cards. At the centre of the inquiry are the fee
practices of Canada’s two major
credit card companies, Visa and MasterCard, who have hiked merchant
charges over the past year. Merchants have asked Parliament to examine
the uncontrolled escalation in credit card fees as well as the imminent
destruction of Canada’s low-cost and efficient debit system as Visa and
MasterCard prepare to enter the Canadian market with their own debit
products. Merchants have also been alarmed by the explosion of premium
cards into the Canadian market – cards that carry an increased cost for
merchants. In year’s past these more expensive cards would typically
represent a small percentage of a merchant’s credit card transactions,
but they’ve jumped to more than 30% for many merchants in less than a
year. The hearings signal the first time that credit and debit card
issues have been examined by Parliament.
MasterCard Canada has told the Senate
Standing Committee on Banking, Trade and Commerce that it strongly
believes additional regulatory management of payment system fees will
result in unintended consequences for both Canadian consumers and retail
merchants. MasterCard believes it is unfortunate that the Retail
Council of Canada (RCC) and Canadian Federation of Independent Business
(CFIB) have called for government regulation before providing
recommendations to MasterCard. MasterCard and the CFIB have agreed to
meet in early May to discuss
the recommendations the CFIB made to the Senate Committee. MasterCard is
awaiting a response from the RCC to its offer to meet.
StopStickingItToUs Coalition and the President and CEO of Retail Council
of Canada has commended the Competition Bureau for investigating Visa
and MasterCard under the “abuse of dominance” rules of the Canadian
Competition Act. The public
announcement of the investigation came at the opening session of Senate
Banking Committee hearings that will “study the credit and debit card
systems in Canada and their relative rates and fees, in particular for
businesses and consumers”.