December 9, 2023

Business Visa

The Business Visa Is Mightier Than Sword

Sherwood Park business rejects new Visa, Mastercard rules

Merchants can now pass credit card processing fees onto their customers, but at least one local small business said it won’t.

The new rules are part of a class action lawsuit settlement and allow businesses to add a surcharge on purchases made with a credit card – if they choose.

“I think a lot of people would choose not to shop with us if they knew we were going to charge them extra for using their credit card,” said Kristen Lang, owner of K-Lee Boutique in Sherwood Park.

The small business owner said that credit card processing fees are built into her business.

Businesses are charged 1.5 to 2.5 per cent of the sale total in processing fees every time someone pays with their credit card, said Dan Kelly, president of the Canadian Federation of Independent Business (CFIB).

These fees vary by card and are paid by the retailer, adding up to billions of dollars a year in revenue for credit card companies – something he said not many people know.

The new agreement, made by Mastercard and Visa, came into effect Oct. 6. Kelly said it’s a chance for businesses to try and cover some of those losses.

“Certainly for so many small businesses, these fees that are paid every time a card is swiped just add up to such a significant volume that businesses are buckling under it,” he said.

Kelly added that COVID-19 restrictions caused credit card fees for business to skyrocket as people abandoned cash and increased their online shopping, and many small businesses still have not returned to pre-pandemic sale levels.

These costs may motivate some small businesses to pass on the fees to the consumer, he said, but others will skip the surcharge to avoid alienating their customers.

“I don’t expect most retailers or restaurants will go down this road, simply because there is so much competition that they’re going to want to ensure that they don’t risk losing any customers along the way,” he said.

Larger companies that manage big purchases are more likely to pass on those fees, Kelly said, and Telus has already announced that it will be adding a credit card surcharge.

“It’s an awkward spot for a merchant to be in. You either forgo the revenue possibility or you add a surcharge and risk losing some customers. It’s a difficult decision for a merchant to make.”


Lang said she won’t be taking advantage of the new surcharge rules.

“For us it wasn’t even a question,” she said. “It does add up for sure on our end, but that’s what it costs to do business, and we appreciate our customers and we would never put that extra burden on them.”

Lang said she doesn’t want an extra charge to be a deterrent or discourage shoppers from coming to her store.

She added that using cash or debit does help her avoid those extra costs, but she doesn’t want customers to feel like they can’t use their credit card at her store.

“It’s always great to try to choose local, and one of the reasons I would definitely not charge someone is I would hate that for them to be a reason to not come shop with us.”

“We accept all credit cards. We want you to come shop with us.”

Before instituting a surcharge, businesses must inform their customers, post signage and register with their credit card company. Surcharges are capped at 2.4 per cent of the sale or the amount it costs the merchant to accept the card, whichever is less.

For more information on the new surcharge rules,visit

With files from CTV News Edmonton’s Alison MacKinnon