Visa, Mastercard Agree to Cut Canada Interchange Fees
- New agreement will see average fees of 1.4% starting in 2020
- Canadian businesses could save $192 million, government says
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Visa Inc. and Mastercard Inc. agreed to cut Canadian credit-card transaction fees in a move that could save smaller businesses C$250 million ($192 million) a year and crimp revenue for Canadian lenders.
The U.S. companies agreed to reduce the average annual interchange rate in Canada by 10 basis points to 1.4 percent on cards, Canada’s finance department said Thursday in a statement. The new rate takes effect in 2020 and runs for five years. The government estimated that small and medium-sized businesses could save C$25,000 over the period.