Mastercard Canada released a press release a couple of days ago announcing they have accepted an opportunity to appear before the Senate Standing Committee on Banking, Trade and Commerce in order to discuss the payments industry, as well as to address the significant misinformation being propagated by retail sector lobbyists.
“The many benefits Canadian merchants receive from card acceptance continue to be downplayed,” said Kevin Stanton, President, MasterCard Canada. “I look forward to the opportunity to discuss the important role card payments play in helping maintain a well-functioning financial system in Canada.“
They have even created a full website explaining how interchange works and common myths associated with interchange. The website is called InterChangeTruth.com, this seems to be a offensive approach to dealing with groups like Stop Sticking It To Us coalition, who Mastercard Canada says are fueling myths about how interchange works and affects Merchants and consumers.
A couple of examples they make on their InterChangeTruth.com site are:
Myth: Interchange fees cover the cost of incentive programs, corporate card programs and marketing.
Fact: Interchange fees do compensate card issuers for the variety of activities they undertake in offering credit cards in the market. Incentive programs, card programs and marketing are some of those components but so are security and fraud programs, credit risk, promotional programs executed with retailers to drive business to their stores, and many other initiatives that benefit merchants. Merchants pay a fee to their acquirer for each transaction they process in exchange for the value they get from card payments, including:
- payment guarantee for authorized transactions
- increased sales
- customer satisfaction
- increased safety and reduced pilfering
- ability to serve international customers
- infrastructure, security and innovation investment
- the ability to process e-commerce, phone and catalogue sales
Myth: The current debit system in Canada offers the greatest benefits to consumers and merchants.
Fact: The incumbent Canadian debit system is a privately-held monopoly which for many years had no direct competition in Canada. Therefore it faced no competitive pressures to innovate, improve service, enhance security and fraud systems, or establish attractive pricing for merchants.
Anyway it is an interesting read and the site is only 6 or 7 pages, well worth a read to hear Mastercard’s side.
What are your thoughts as a merchant…? Let us know in the comment section below.
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