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Senator Calls for Investigation of Credit and Debit Card Systems

Today, Senator Pierrette Ringuette tabled a motion in the Senate, that the Standing Senate Committee on Banking, Trade and Commerce be authorized to examine and report on the credit and debit card systems in Canada and their relative rates and fees, in particular for businesses and consumers. The proposed investigation would endeavor to expose the impact of rates and fees on businesses and consumers – focusing on rising interchange rates and interest rates.  Interchange rates are the percentage of the total purchase price that businesses pay in order to provide credit card services to their customers – and they have risen substantially in 2008.

The Basic Facts:


  • Canadians hold 64.1 million credit cards and use 65% of them to purchase for $294 billion of goods and services;
  • 80% of the 64.1 million credit cards in Canada are Visa or MasterCard;
  • Consumers pay up to 24.75% in interest rate and;
  • Credit card transaction fees or, to use the financial sector language, the interchange rate, are up to 3% of purchases for businesses, up to 1.8% for Governments and 1.5% for charities.
  • Interac has entered into talks with the Competition Bureau regarding the abandonment of Interac’s “not-for-profit mandate”.
  • Currently, the average cost to businesses for debit card transactions is $0.12 per transaction in addition to consumer fees.


In her speech, Senator Ringuette indicated the example of Australia where interchange rates are currently 0.45% for businesses, 0.33% for government agencies and 0% for charities. 


The Senator strongly believes that the Senate should investigate and report on the credit and debit card systems in Canada.  She argues that the government must establish regulations and oversight to ensure transparency into credit and debit card rates.