Greenhouse Canada

News
Credit, debit industry has one month to adopt code


April 16, 2010
By The Canadian Press

April 16, 2010 – Retailers' groups are applauding the new code of
conduct for credit-and debit-card companies being introduced in Canada.

April 16, 2010 – Retailers' groups are applauding the new code of
conduct for credit-and debit-card companies being introduced in Canada.

Finance Minister Jim Flaherty said Friday that the voluntary code of conduct will be in place within a month.

Advertisment

The
code is aimed at reducing the cost of card transactions for businesses,
which pay a fee to credit and debit companies each time a consumer
swipes a card.

The Canadian Federation of Independent Business
welcomed the announcement, calling it an "important step" as the summer
business season nears.

"These developments will create a better
future for merchants and help ensure a fair and transparent credit and
debit card market instead of just letting large industry players call
all the shots," Catherine Swift, president of the group said in a
release.

The Payments Accountability Council, led by Retail
Council of Canada and the Canadian Council of Grocery Distributors and
backed by more than 250,000 Canadian merchants, called the announcement
"a solid victory for merchants across the country."

Flaherty, during an event at Toronto's Eaton Centre, said the industry has until May 17 to review and adopt the measures.

The
code will give merchants the freedom to choose which card networks they
use, helping them control costs and pass those savings on to customers,
he said.

Flaherty proposed the code last fall after taking heat
from retailers over the processing fees charged to them by credit card
companies to carry their services.

The code, among other things,
implements rules to ensure merchants receive a minimum of 90 days
notice of any fee increases. Store owners will be allowed to cancel
their contracts without penalty following notification of a fee
increase.

It also states that merchants must agree in writing to
accept new products or services, meaning there will be no so-called
negative option acceptance.

The Retail Council of Canada has
estimated credit-card fees cost merchants about $4.5 billion a year.
Critics say such charges wind up in the cost of goods and services sold
to consumers.

The NDP critic for consumer protection said there's no teeth to Flaherty's proposal because it's voluntary.

"The intention is there, but it's disappointing that it's not mandatory," said New Democrat MP Glenn Thibeault.

Thibeault
said he would like to see legislation in order to protect small
businesses and consumers. He would like to also see more on the
consumer side.

"There's nothing here to talk about the exorbitant
interest fees, charges and hidden fees that consumers have to pay to
these credit card companies," said Thibeault.

Links to other stories on this topic

Flaherty’s new credit-debit code tougher than expected – The Toronto Star

Canada’s stores, small business claim victory in card code – Canoe.com

Credit, debit card firms face new conduct code – CBCNews.ca

Credit card/debit card code of conduct: FAQ's
– CBCNews.ca


Print this page

Related



Leave a Reply

Your email address will not be published. Required fields are marked *

*