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Government action urged on credit-card fee hikes

PUBLICATION: The Chronicle-Herald
DATE: 2009.01.31
SECTION: Business

Government action urged on credit-card fee hikes

TORONTO (CP) - Calls are rising for government action to scrutinize and control fees charged on credit cards. The Retail Council of Canada says the system "is failing many Canadians," and the Canadian Community Reinvestment Coalition accuses the government of "negligence" in bank regulation.

The Retail Council, representing more than 40,000 store operators, says that at a time when many Canadians are struggling and businesses are challenged to decrease costs, the fees charged by credit card companies and banks are increasing.

It's urging the Senate to adopt the proposal of Senator Pierrette Ringuette for an investigation by the upper house's committee on banking, trade and commerce. The retailers say card fees are an enormous hidden cost for average Canadians, amounting to $4.5 billion a year.

Among other things, they're demanding to know why the fees merchants pay on credit card transactions - as much as two per cent - increase with the size of the purchase, when a large transaction and a small one cost about the same to process.