OTTAWA – Liberal Senator Pierrette Ringuette (New Brunswick) has re-introduced two Senate Public Bills that seek to address significant flaws in the credit and debit card payment systems that were identified in last year’s Senate Banking, Trade and Commerce Committee report on this issue.
“The Minister of Finance has not addressed the central issue with respect to debit and credit cards, which is excessive fees and interest rates,” said Senator Ringuette. “Unfortunately, he has chosen to go with a voluntary code of conduct for the industry, and I’ll be honest, I have my doubts that relying on ‘good will’ will do anything to fix this problem.”
The first Bill, S-201, An Act to amend the Office of the Superintendent of Financial Institutions Act (credit and debit cards) implements one of the key recommendations of the Senate Banking, Trade and Commerce Committee report which called on the Minister of Finance to appoint an oversight body to closely monitor the debit and credit card industry in Canada. The Office of the Superintendent of Financial Institutions already provides some oversight into Canada’s financial services sector; this new legislation would grant the Superintendent the specific authority to oversee the rates and fees charged by banks for the use of credit and debit cards.
The second Bill, S-202, An Act to amend the Canadian Payments Act (debit card payment systems), will amend existing legislation to specifically name Interac, Visa and MasterCard as “designated payment systems” under the Canadian Payments Act. With Visa and MasterCard entering the Canadian debit market, this legislation will ensure that all three debit card operators will be subject to the same laws and standards.
“There is real urgency with respect to debit cards in Canada. The Competition Bureau has denied Interac’s request to move to ‘for profit’ status, which would allow them to compete against Visa and MasterCard,” said Senator Ringuette. “Without a level playing field, Interac will be at a competitive disadvantage.”
“Since I’ve started working on this issue, all I’ve heard from stakeholders is that they want fairness. This legislation that I’ve tabled today is a start towards a system that works on behalf of consumers and small and medium sized businesses, who are the engines of growth in our economy.”