Amex Small Business Credit Cards – Business groups say Canada’s credit card fees are much higher than those in Europe and Australia and could raise consumer prices.Ryan Remiorz/The Canadian Press
Retailers and other businesses are demanding lower fees from major credit card companies amid a long-running fight over what many merchants say are inflated Canadian rates.
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The two largest credit card companies, Visa Canada and MasterCard Canada, charge businesses an average of 1.5 percent of their transactions to accept plastic, with some interchange fees ranging from 2.5 percent or more.
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But business groups counter that Canadian rates are still far higher than those in Europe and Australia and could raise consumer prices. For example, in Britain, the interest rate is limited to only 0.3 percent; 0.28 percent in France; In Australia, it is 0.5 percent.
For its part, American Express Canada has higher fees — 3 percent to 3.5 percent for small merchants.
The Canadian Federation of Independent Business (CFIB, ), which now represents 110,000 small and medium-sized businesses, is set to strike a deal with JPMorgan Chase on Monday to cut Amex fees by almost 50 percent to 1.8 percent. for some members attempting to shake up the stable Canadian credit card market.
“We think this will expand American Express’ reach in the small business market, so we hope it will create more competition between the big three electronic payment companies, as opposed to the big two now,” Dan said. Kelly, CFIB president.
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The Amex deal is a sign of a fight by retailers and other businesses for more affordable credit card fees, a battle that began in 2016 with Walmart Canada Corp. highlighted when the discount giant stopped accepting Visa at its Thunder Bay and Manitoba stores. complained that the fees were “unacceptably high”.
The standoff ended in early 2017 when Walmart dropped its fees with Visa to an undisclosed level — less than 1 percent, according to sources — far beyond what many small businesses pay, reminding them that it doesn’t have them. reputation of big players.
The CFIB’s deal with Amex follows the group’s deal with MasterCard Canada last year, which cut most CFIB members’ fees to 12.5 per cent of the customer’s purchase value from the previous 1.44 per cent to 1.26 per cent – the new levels proposed. to only a small fraction of the country’s largest merchants.
However, other business groups say they don’t want special deals with credit card companies for their members, instead calling for federal policy changes to pave the way for broader fee reductions.
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Carl Littler, vice-president of the Retail Council of Canada, said businesses accepting the cards need a “reasonable discount” on top of the current fees. “The credit card duopoly dictates the rates,” he said. “It increases consumer prices.”
In response to growing tensions between businesses and credit card companies over fees, federal Finance Minister Bill Morneau said he would review Canada’s payments system in 2016.
Treasury Department spokesman David Barnabe said Friday that officials met with “several stakeholders, including all major credit card networks, card issuers, acquirers, merchant groups and consumer groups.”
In 2014, Visa and MasterCard reached a voluntary agreement with Ottawa to reduce their fees to an average of 1.5 per cent, from 1.6 per cent and 1.7 per cent respectively. These rates came into effect for five years starting from 2015.
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Card companies must audit their payments, but Gary Sands, president of the Small Business Affairs Coalition, another small business group, says audits should be done by third parties, not internally.
Mr Sands also hopes the federal government will demand lower fees for the groups’ members rather than cutting concessionary deals.
Credit card companies offer attractive rates to large businesses like Walmart and Costco Wholesale Canada, which often charge small businesses higher fees to make up the difference, he said. “Main Street subsidizes Bay Street,” Mr. Sands said. “They put us at a competitive disadvantage.”
However, Richard Crone, payments specialist at Crone Consulting, said businesses need to be more innovative and move to digital payments to cut costs and better connect with customers.
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Through mobile payments, he said, companies can entice customers to use low-cost private-label credit cards or debit cards by tying them to promotions and rewards.
Walmart launched mobile payment south of the border more than two years ago, helping the discounter collect data about its customers to use in marketing and merchandising planning.
While Walmart Canada doesn’t offer a mobile wallet here, it’s continually evaluating different apps, said spokesman Rob Nicol. Regarding credit card fees, he said the retailer “strives to negotiate the best terms possible with any supplier, and every penny we save on credit card fees allows us to lower prices for our customers.
“We continue to believe that credit card fees in Canada are too high. Canadian merchants pay at least three times the fees paid by all merchants – large and small – in the 27 countries of the European Union. We believe that fees should be lower for everyone. We lower We support and want to work with all merchants who require payment.”
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Under the CFIB agreement with Amex for lower fees, the group combines with Chase’s merchant services for lower transaction fees for businesses using Amex’s OptBlue payment processing, which Amex says aims to make it easier for small businesses to accept their Amex cards.
The CFIB offer is available to about a third of its current members who already use Chase, but Mr. Kelly said he expects more of them to switch to it and OptBlue to match the Amex fee discounts. He said he is still trying to negotiate a fee reduction with Visa. They did not say “no”.
A Visa spokeswoman said it lowered fees for grocery retailers by 1.23 percent in 2016 and made changes for other small merchants last year “to reduce costs.” Visa will “continue to work with the government and other stakeholders to promote a competitive, efficient, innovative and secure payments system in Canada.”
Card companies have said they need higher rates to invest in technology and innovation in initiatives such as chip cards and contactless payments.
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Trying to decide which credit card features are best for you? Preet Banerjee explains some of the more common features available on credit and debit cards. When considering the best American Express credit cards to apply for to help you travel the world with points, it’s important to be aware of certain limitations. the number of different products you can store at the same time.
In particular, while there’s no limit to the number of American Express charge cards you can hold, you’re actually limited to four credit cards at any given time.
Since there are quite a few American Express credit cards worth considering, you’ll need to think carefully about which of the four American Express credit cards you’re most interested in and whether you’ll switch between them over time. .
American Express is the only major credit card issuer to offer payment cards in addition to credit cards:
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You can keep unlimited payment cards, which means you can collect welcome bonuses on all Platinum Card, Business Platinum Card, Business Gold Card and Aeroplan Card without worrying about reaching card limits.
The following American Express credit cards are generally considered the most powerful for upgrading your travel (as you can see, there are already more than four):
(Note that the Gold Rewards Card switched from a charge card to a credit card after its relaunch in August 2021, adding further intrigue to the decision of which four credit cards to keep.)
At the same time, the following products may favor those who prefer a strategy of fewer maintenance points or even a refund:
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However, these are generally the less useful products in the overall Amex lineup. If you’re looking to collect Air Miles, it’s worth looking into BMO’s Air Miles credit cards to avoid taking up more valuable space among Amex credit cards.
If you’re interested in the low-end SimplyCash or Choice cards, then you’re not at the advanced stage in the Miles & Points game where you’d consider juggling four credit cards in the first place.
To decide the best strategy, we need to narrow down American Express’s list of the seven best travel credit cards (ie the first set of seven credit cards listed above) to four.
Best known for its ability to earn 5x MR points on food and beverages (including anything you can buy at the grocery store), the Kobalt Card is a reliable points generator and a key component of any optimal points strategy.
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This is especially the case after the card underwent favorable changes in the summer of 2021, now earning points transferable 1:1.
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