If you shop using your credit card frequently, you might want to reconsider. Soon, businesses will be able to make you pay an additional fee.
When you pay via credit card, you and the business you’re paying are both charged a processing fee.
The Canadian Federation of Independent Business (CFIB) has announced that beginning Thursday, October 6, it will be up to merchants to decide if they want to transfer their side of the processing fee to the shopper.
Power to surcharge on credit cards coming soon; nearly 20% of small businesses are looking to use it
Learn More: https://t.co/FlaNH1KC2o
— CFIB News (@CFIBNews) October 5, 2022
This comes after a major class action lawsuit settlement involving Visa and Mastercard. Currently, the two financial service companies host a dominant, widespread network of credit card users.
Both companies have allowed businesses to decide to charge extra if a customer opts to pay via credit card at the point of sale. CFIB says this is because credit card processing fees can be hard to track and have been going up over the years, costing merchants a significant chunk of money.
They believe this is especially affecting smaller businesses, which find it harder each day to compete with large companies.
Surcharges are capped at 2.4% of the amount it costs companies to accept credit cards. Merchants will be expected to educate their customers, via posters or other resources, about the surcharge fee.