The Government of Canada has announced that it is delivering on the Budget 2023 commitment to lower credit card transaction fees for small businesses by finalizing new agreements with Visa and Mastercard, while also protecting reward points for Canadian consumers offered by Canada’s large banks.

Small businesses pay fees to process credit card transactions, with the largest component being the interchange fee paid to credit card-issuing financial institutions, such as banks. These new agreements will help more than 90 per cent of credit card-accepting businesses in Canada qualify for lower rates and see their interchange fees reduced by up to 27 per cent from the existing weighted average rate. These reductions are expected to save eligible Canadian small businesses about $1 billion over five years.

For qualifying small businesses, Visa and Mastercard have agreed to:

• reduce domestic consumer credit interchange fees for in-store transactions to an annual weighted average interchange rate of 0.95 per cent;
• reduce domestic consumer credit interchange fees for online transactions by 10 basis points, resulting in reductions of up to 7 per cent; and,
• provide free access to online fraud and cyber security resources to help small businesses grow their online sales while preventing fraud and chargebacks.

For more information: Government announces lower credit card transaction fees for small businesses - Canada.ca