TORONTO, Canada—Members of the Canadian Federation of Independent Business (CFIB) will soon be paying lower merchant fees through Mastercard Canada.
The deal could place more pressure on credit card firms to reduce their rates and prompt other associations to seek preferential pricing, the Globe and Mail reported.
The CFIB represents more than 100,000 small firms, unveiled a deal with Mastercard that reduces most of CFIB members' transaction fees to levels that are now offered to just a small number of the country's largest merchants, those with annual Mastercard sales of $3 billion or more. It will mean that, starting on April 3, most members' interchange fees for regular credit cards will drop by 12.5% to 1.26% of the value of a customer's purchase from 1.44% currently, the Globe and Mail reported.
Those rates will decrease by 22% for premium credit cards – to 1.38% from 1.77% – and by 7.8% for ultrapremium plastic, to 1.9% from 2.06%.
The Globe and Mail noted that the initiative comes amid rising pressure from retailers and other businesses for lower credit card fees, highlighted last summer when Walmart Canada stopped accepting Visa cards in Thunder Bay and Manitoba, complaining that the fees were high.