Walmart Canada has announced that it will no longer accept Visa cards at its stores due to “unacceptably high” transaction fees. Visa, however, notes that they offered “one of the lowest rates available to any merchant in the country.”
Information on Visa Canada’s website shows that for standard retail purchases made in-store, fees range from 1.42 to 2.08 per cent, while MasterCard charges 1.44 to 2 per cent for standard purchases at independent retailers. However, MasterCard offers lower rates to large retailers, going as low as 1.26 per cent for those that have a minimum “net purchase volume” of $3 billion.
In a statement, Walmart said that it pays “over $100 million in fees to accept credit cards each and every year.”
The first stores to stop accepting Visa, located in Thunder Bay, Ontario, will begin on July 18. The new system will then be adopted in phased across the country. Walmart has more than 400 locations in Canada.
Walmart isn’t the mass retailer to make this move—No Frills doesn’t accept Visa or American Express, noting that the fees are too expensive for their business. Additionally, Costco only accepts MasterCard when it comes to credit card payments. Walmart will continue to accept MasterCard, American Express and Discover cards.
A representative from Visa Canada adds that the company “regrets” Walmart’s decision, and that it will have a “negative impact” on Walmart’s shoppers.
Walmart Canada said the company is holding out hope that it will be able to “reach an agreement” with Visa for lower fees.
