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Restaurant industry applauds Senate decision to review card fees

TORONTO, March 5 /CNW/ - The Canadian Restaurant and Foodservices Association (CRFA) applauds the Senate's decision to review debit and credit card fees for merchants. On Tuesday, the chamber supported Senator Pierrette Ringuette's motion to have the Senate Committee on Banking, Trade and Commerce conduct a study on the credit and debit card systems in Canada, including the fees charged to businesses and consumers.

The restaurant and foodservice industry, which employs more than one million Canadians and generates just under 4% of the country's gross domestic product, has been struggling with skyrocketing fees for processing credit card payments and with unfair business practices.


"In an industry where average profit margins hover around 4.2%, operators have a hard time absorbing credit card fees that have climbed as high as 3%," says CRFA's Vice President Labour and Taxation, Justin Taylor. "And the situation is even worse in Ontario where margins are closer to 2.9%."


In the past year, Visa and MasterCard have moved from a simple fee to a complex matrix system with different fees for different types of cards. They have also automatically switched some cardholders to "premium" credit cards which offer additional benefits to cardholders at no additional fee but cost merchants significantly more to accept.


Also, Interac has recently signalled their intent to move from a not-for-profit entity to a for-profit one. Merchants are concerned that this will lead to the same type of jump in fees that they have seen on credit cards.


"We hope that the Senate's review will lead to improved business practices and fees charged to restaurants that are fair, transparent, and predictable," says Taylor.


CRFA is a member of the Stop Sticking It ToUs Coalition, a group of Canadian associations representing more than 120,000 businesses that have joined forces to put a stop to skyrocketing credit card fees.