Starting Thursday, businesses in Canada will be able to pass credit card fees on to their customers.
The change is the result of a multimillion-dollar class-action settlement involving Visa and Mastercard over what are known as interchange or swipe fees: the money credit card companies, banks and payment processors collect from merchants with every transaction.
Those fees can range from around one per cent to as much as three per cent for cards, with perks like cash back or loyalty points, cutting into business profits.
According to the Canadian Federation of Independent Business, Visa and Mastercard previously restricted merchants' ability to include fee surcharges or refuse "premium" credit cards with higher costs. Some companies, like Telus, have already announced new credit card processing fees.
The new rule, which allows merchants to pass fees on to consumers, goes into effect on Oct. 6. Merchants are required to provide written notice to Visa and Mastercard. As part of the settlement with the companies, Canadian business were also able to claim up to $5,000 in credit card fee rebates.
