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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.
All credit cards charge fees to retailers, which generally are between one per cent and 2.5 per cent of the cost what's being sold. The fees vary depending on the type of card the customer is using — cash-back and premium cards generally have higher fees — and the type of retailer they're shopping at.
Walmart Canada quietly made the announcement on Saturday that it would gradually stop accepting Visa cards at all of its locations, citing "unacceptably high" fees.
But a statement from Visa said the credit card company offers "one of the lowest rates available to any merchant in the country."
Documents on Visa Canada's website show that for standard retail purchases made in-store, fees range from 1.42 to 2.08 per cent. Meanwhile, MasterCard's website shows that for standard purchases at independent retailers, its fees range from 1.44 to 2 per cent.
But MasterCard also offers lower rates to large retailers — as low as 1.26 per cent for those that have a minimum "net purchase volume" of $3 billion.
Representatives from Walmart Canada declined to say how much money customers charge to their credit cards at their stores.
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 Canada-wide in phases.
Walmart has more than 400 locations in Canada, and more than 11,500 worldwide, according to the company's global website.
Walmart isn't the first store to stop accepting Visa — No Frills doesn't accept Visa or American Express, saying that they are too expensive for their business. And Costco only accepts its own store credit card, which is a MasterCard.
Walmart says it will continue to accept MasterCard, American Express and Discover cards.
A representative from Visa Canada said in a written statement 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.
The two companies have sparred about similar issues south of the border, too.
Last month, Walmart Stores Inc. filed a lawsuit against Visa Inc. in a New York court, saying the payment operator was resisting the use of personal identification numbers (PINs) by U.S. customers making purchases on Visa debit cards.
Walmart and other U.S. retailers have pushed to allow customers to use PINs instead of old-school signatures in a bid to prevent counterfeit card fraud. However, banks and payment network operators recently adopted chip technology and prefer chip cards verified by signatures, seeing no need to invest further in more expensive PIN technology.
According to the lawsuit, Walmart says it pays Visa more for signature-based transactions rather than those made using PINs
And in March, Walmart had also sued Visa Inc. in an Arkansas court, where the company is headquartered, accusing Visa of excessively high swipe fees. The lawsuit came several months after the retail giant opted out of a $5.7 billion class-action settlement between merchants and Visa and MasterCard Inc, approved by a federal judge in Brooklyn, N.Y.
Walmart, Amazon.com Inc, and Target Corp were among those opting out of the monetary components of the settlement, in order to have the freedom to seek damages on their own.
"The anti-competitive conduct of Visa and the banks forced Walmart to raise retail prices paid by its customers and/or reduce retail services provided to its customers as a means of offsetting some of the artificially inflated interchange fees," Walmart said in court documents.
"As a result, Walmart's retail sales were below what they would have been otherwise."
Walmart to stop taking Visa in Canadian stores
All credit cards charge fees to retailers, which generally are between one per cent and 2.5 per cent of the cost what's being sold. The fees vary depending on the type of card the customer is using — cash-back and premium cards generally have higher fees — and the type of retailer they're shopping at.
Walmart Canada quietly made the announcement on Saturday that it would gradually stop accepting Visa cards at all of its locations, citing "unacceptably high" fees.
But a statement from Visa said the credit card company offers "one of the lowest rates available to any merchant in the country."
Documents on Visa Canada's website show that for standard retail purchases made in-store, fees range from 1.42 to 2.08 per cent. Meanwhile, MasterCard's website shows that for standard purchases at independent retailers, its fees range from 1.44 to 2 per cent.
But MasterCard also offers lower rates to large retailers — as low as 1.26 per cent for those that have a minimum "net purchase volume" of $3 billion.
Representatives from Walmart Canada declined to say how much money customers charge to their credit cards at their stores.
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 Canada-wide in phases.
Walmart has more than 400 locations in Canada, and more than 11,500 worldwide, according to the company's global website.
Walmart isn't the first store to stop accepting Visa — No Frills doesn't accept Visa or American Express, saying that they are too expensive for their business. And Costco only accepts its own store credit card, which is a MasterCard.
Walmart says it will continue to accept MasterCard, American Express and Discover cards.
A representative from Visa Canada said in a written statement 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.
The two companies have sparred about similar issues south of the border, too.
Last month, Walmart Stores Inc. filed a lawsuit against Visa Inc. in a New York court, saying the payment operator was resisting the use of personal identification numbers (PINs) by U.S. customers making purchases on Visa debit cards.
Walmart and other U.S. retailers have pushed to allow customers to use PINs instead of old-school signatures in a bid to prevent counterfeit card fraud. However, banks and payment network operators recently adopted chip technology and prefer chip cards verified by signatures, seeing no need to invest further in more expensive PIN technology.
According to the lawsuit, Walmart says it pays Visa more for signature-based transactions rather than those made using PINs
And in March, Walmart had also sued Visa Inc. in an Arkansas court, where the company is headquartered, accusing Visa of excessively high swipe fees. The lawsuit came several months after the retail giant opted out of a $5.7 billion class-action settlement between merchants and Visa and MasterCard Inc, approved by a federal judge in Brooklyn, N.Y.
Walmart, Amazon.com Inc, and Target Corp were among those opting out of the monetary components of the settlement, in order to have the freedom to seek damages on their own.
"The anti-competitive conduct of Visa and the banks forced Walmart to raise retail prices paid by its customers and/or reduce retail services provided to its customers as a means of offsetting some of the artificially inflated interchange fees," Walmart said in court documents.
"As a result, Walmart's retail sales were below what they would have been otherwise."
Walmart to stop taking Visa in Canadian stores
