Walmart Canada Expands Visa Ban

All 16 Walmart stores in Manitoba will stop accepting Visa cards on October 24.

September 19, 2016

MANITOBA, Canada – Walmart Canada began informing customers last week that it will stop accepting Visa credit cards at its 16 stores in the province of Manitoba beginning October 24, 2016. On July 18, 2016, Walmart Canada stopped accepting Visa credit cards in Thunder Bay.

Following an evaluation of credit card transaction fees in Canada and the rest of the world, Walmart says that it has concluded the fees applied to Visa credit card purchases remain unacceptably high.

“To ensure we are taking care of our customers’ best interests and delivering on our promise of saving customers money, we constantly work to reduce our operating costs, including credit card fees. Unfortunately, Visa and Walmart have been unable to agree on an acceptable fee for Visa transactions,” says the retailer on its website.

“Walmart Canada pays [more than] $100 million in fees to accept credit cards each and every year. Lowering costs such as these is necessary for us to be able to keep our prices low and continue saving our customers money.”

A spokesperson for Walmart Canada told CBC/Radio-Canada that the Visa card ban could extend to other provinces, adding that Manitoba was chosen for this round because stores in the province are “most ready” to phase out Visa acceptance. Walmart operates more than 400 stores throughout Canada.

CBC adds that Visa Canada called Walmart’s expansion of its ban “disappointing.” A Visa spokesperson told the news source that consumers in the area “want the option to use the payment method of their choice when shopping—including at Walmart stores.”

The news source writes that the battle between Visa and Walmart “comes against a backdrop of increased scrutiny over interchange fees, and that Canadian interchange fees are among the highest in the world.

"These excessive interchange rates mean that Canadian consumers pay at least $4.5 billion more for all credit purchases each year than they would if our rates were comparable to those in the EU," Karl Littler, vice president of public affairs at the Retail Council of Canada, told the new source. "At the current 1.50% average rate, over the four remaining years of the voluntary agreement, Canadians will pay at least $18 billion more than they should."

Meanwhile, Retail Council of Canada President Diane Brisebois commented that more needs to be done to level the playing field in Canada. "The real issue is an absence of both competition and regulation that has allowed the credit card networks to overcharge merchants in Canada with fees five times what they should be," she told the news source.

Advertisement
Advertisement
Advertisement