Small Business pledges reduction in prices, jobs and investment from reduced credit card fees.
ACTA is involved with "Small Business Matters", an active coalition formed with the objective of advocating on behalf of small and medium-sized independent businesses.
The federal government took an important step in establishing a voluntary code of conduct a number of years ago, which the associations that are included in the Small Business Coalition, applauded at the time. However, this has not been able to address the continued and significant impact credit card swipe fees are having on businesses across Canada. As the Competition Bureau has pointed out, the impact of these fees is disproportionately higher on the margins of small business.
Over the last few months, our coalition has met with officials of the Minister of Finance office and sent a letter to Hon. Joe Oliver, to convey our concerns directly and to bring the unique perspective of small business to the consultation process around how to reduce fees and to what degree.
Our coalition members are sensitive to the need to convey to the public, the direct impact over $5 billion in swipe fees is having on consumers and communities across the country. Accordingly, our Coalition, representing over 90,000 small and medium size businesses in Canada, has unanimously adopted a Pledge To Consumers and reads as follows:
“Members of the Small Business Coalition, representing thousands of businesses across Canada, urge the Government of Canada to reduce credit card swipe fees and to bring fairness and transparency to the Canadian Payments Industry.
In turn, our members pledge that the reduction in credit card fees will be to the benefit of consumers and communities across Canada, through improved competitiveness, increased investment, job creation and reduced consumer prices.”
Canada has among the highest credit card fees in the world. While many countries have taken steps to reduce the fees paid by retailers, Canada has yet to do so. Alex Scholten, Vice Chair of the Coalition and President of the Canadian Convenience Stores Association, said, “In addition to reducing fees, it is equally important to establish a process that will provide the retail community with transparency and accountability in how fees are set by the credit card companies.”
Scholten went on to say that more than 90 per cent of all credit card transactions processed in Canada are made through Visa or MasterCard, representing billions of dollars in purchases. “The payments landscape for these two companies stands in stark contrast to the one that exists for Canada’s small business retailers, who operate in fiercely competitive markets with extremely tight margins,” he said.
Sands further stated, “The Competition Bureau of Canada estimates there are about $5 billion in hidden credit card swipe fees paid annually by Canada’s retailers, resulting in higher prices for all consumers, whether they pay by cash, debit or credit. Reducing these fees will benefit consumers and allow small businesses to manage their future, as opposed to having the credit card companies manage it for them.”
We look forward to continuing to work with you and your government as you consult stakeholders with respect to reducing credit card fees and the need to establish transparency and accountability in the payments industry.