They were unable to reach an agreement on an appropriate fee for Visa transactions. This marks the latest in the tussle between the credit card processor and Walmart over fees and other issues, which has been ongoing for years.
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Walmart says it intends to join the list of retailers in Canada that don’t accept Visa cards, citing high fees for transactions. The fees are usually between 1.0 percent and 2.5 percent of the cost what’s being sold.
The company says it spends annually more 100 million in fees to accept payments by credit card, adding that it must “reduce such costs in order to continue to keep prices down and to save money in [its] customers “. the new policy will take effect on July 18 at Walmart Thunder Bay, Ontario. The fees can vary, depending on what type credit card a customer is using, like for example, cash-back or premium cards, which can have a slightly higher transaction fee.
According to the statement posted on Walmart’s website, the first stores to stop accepting Visa will be in Thunder Bay, Ont., starting July 18. After that, it will be rolled out in phases.
In 2014 Visa and MasterCard Inc said they would trim Canadian transaction rates to an average effective rate of 1.5 percent, after complaints about their fees nearly resulted in government intervention. So far there is no official time frame for when your local store will stop accepting it.
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He said Walmart’s analysts have likely crunched the numbers, and determined that without having to pay Visa’s fees, which the company characterized as “unacceptably high”, it would stand to make more money than it loses. Visa says Wal-Mart was offered one of the lowest rates available to any merchant in the country. In a statement, the chain said that “costs associated with purchases made by Visa are now too high”. The company says it will continue to accept MasterCard, American Express and Interac debit.
