Evidence of meeting #17 for Industry, Science and Technology in the 40th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was merchants.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

  • Kevin Stanton  President, MasterCard Canada
  • Andrea Cotroneo  Vice-President and Canada Region Counsel, MasterCard Canada
  • Tim Wilson  Head, Visa Canada
  • Bill Sheedy  Regional President, North America and Head of Interchange Strategy, Visa Canada

4:10 p.m.

Liberal

Dan McTeague Pickering—Scarborough East, ON

Will you provide that information to this committee, then, sir?

4:10 p.m.

President, MasterCard Canada

Kevin Stanton

Yes, I will.

4:10 p.m.

Liberal

Dan McTeague Pickering—Scarborough East, ON

Thank you.

A little earlier you suggested as well that a number of opportunities are given to smaller players to compete, and that it may very well be in their interests to compete.

Tell me something. Because we don't have, up until this very moment, a list of your interchange fees, do you have performance programs of the kind Visa has? How do you believe small business is able to access those better rates, which would obviously save them the time and task of having to spend more simply because they happen to be small? Does that not run contrary to your assertion, sir, that this would be good for small business?

4:10 p.m.

President, MasterCard Canada

Kevin Stanton

We have performance tiers, just like Visa. One of the proposals we put forward to the CFIB was to create a single tier that would acknowledge the collective volume of their membership.

4:15 p.m.

Liberal

Dan McTeague Pickering—Scarborough East, ON

Mr. Stanton, I'm going to shift to debit now, and I know other colleagues here want to talk about this as well. To forgo ad valorem on your Maestro products, you've stated that your flat fee for MasterCard would be lower than that of Interac. How do you know what Interac is going to be?

Second, if they introduce it at 1%, will yours be less? More importantly, your parent or associate company in the United States offers Maestro or MasterCard debit. Do you believe the CEO down the road will introduce that as an ad valorem and walk away from your commitment here to have a flat fee if you get into the business of debit cards?

4:15 p.m.

President, MasterCard Canada

Kevin Stanton

MasterCard makes these decisions on a country-by-country basis. I don't see MasterCard debit as being appropriate for this market because of the pricing environment. To answer your question, it is our strategy to remain at a lower flat fee than Interac. We know what it is because they publish it on the Internet.

4:15 p.m.

Liberal

Dan McTeague Pickering—Scarborough East, ON

But you can't rule that out right now, can you?

4:15 p.m.

President, MasterCard Canada

Kevin Stanton

That's our strategy--just as they can't rule out that we will be higher than they will.

4:15 p.m.

Conservative

The Co-Chair James Rajotte

Thank you very much, Mr. McTeague.

We'll go to Monsieur Vincent.

May 14th, 2009 / 4:15 p.m.

Bloc

Robert Vincent Shefford, QC

Mr. Chair, my questions are for Ms. Cotroneo.

In the letter you sent to the senators, you said the following: “MasterCard does have a debit product in the Canadian marketplace called Maestro.”

Is equipment to process this Canadian product available in Quebec? Does the Maestro card exist in Quebec?

4:15 p.m.

Vice-President and Canada Region Counsel, MasterCard Canada

Andrea Cotroneo

Maestro is MasterCard's debit brand in Canada. Maestro cards do exist in Canada at this time.

4:15 p.m.

An Hon. Member

As well as in Quebec.

4:15 p.m.

Bloc

Robert Vincent Shefford, QC

All right.

I will continue along the same lines. You also state:

Maestro operates in exactly the same way as Interac, processing point-of-sale debit transactions on a real time basis, for a flat fee on a per transaction basis. Maestro also offers the following benefits to consumers and merchants: Maestro is currently the lowest-cost debit proposition in the Canadian market—in fact, Maestro is currently 37.5% cheaper than Interac.

This leads me to ask what the price would be. I was wondering if I was paying too much by using Interac. Therefore, I sought to obtain information about Maestro. Since I was unaware of this product and my curiosity had been piqued, I called the National Bank, located in my riding, to request information about the Maestro card, and the costs associated with it.

Yet, the National Bank was not aware of the existence of such a card. I was re-directed to representatives of MasterCard, located in Montreal, to whom I asked the same questions. They were also unaware of the existence of a Maestro card. They then transferred my call to TelNat so that I could be given information, and they also had no idea what the Maestro card was. Then my call was transferred to representatives of the National Bank, in Montreal, who had no idea of what the Maestro card was. Representatives of the National Bank then transferred my call to Global Payments, who also were unaware of what the Maestro card was.

I spent nearly two hours making telephone calls to try and obtain a Maestro card, and find out what the rates are; nobody is aware of your product!

Can you explain to me why no one is aware of your product, when you claim that anyone in Canada can obtain a card?

4:15 p.m.

Vice-President and Canada Region Counsel, MasterCard Canada

Andrea Cotroneo

Maestro behaves exactly like Interac. It is PIN-based, so consumers enter a personal identification number, and the funds exit the consumer's account in real time. There's no lag of time there. Maestro is in its infancy in this country. We have just introduced it, and not all of our customers offer it at this time. That is likely why the National Bank, for example, does not offer Maestro at this time.

4:15 p.m.

Bloc

Robert Vincent Shefford, QC

How is it that the headquarters of MasterCard, located in Montreal, isn't even aware of the existence of this product? Is this product integrated with a credit card, or is it an entirely separate card?