Canadian businesses have won the right to pass credit card fees to their customers following a class-action settlement.
The settlement means credit card companies Visa and Mastercard must now provide businesses with the option to pass the 1 to 3.5% merchant charge down to customers.
The merchants intending to introduce this surcharge have to disclose it to their customers, making sure that it’s clear the surcharge is applied by the merchant themselves, and by not Visa or Mastercard.
The new rule, which allows merchants to pass fees on to consumers, goes into effect on Oct. 6.
According to the Canadian Federation of Independent Business, Visa and Mastercard previously restricted merchants’ ability to include fee surcharges or refuse “premium” credit cards with higher costs.
Some big companies such as Telus have already announced plans to introduce this surcharge to customers.
According to a survey by the Canadian Federation of Independent Businesses, about 19% of small businesses have already confirmed their intention to add a surcharge to customers’ bills.
An additional 25% say they will add the surcharge if their suppliers or competitors do, while 15% have promised not to add the extra fee.