Industry Committee on Oct. 24th, 2024

[Jean-Denis Garon, Bloc, Mirabel, QC]

You already said that, and you know as well as I do that time is a scarce resource. Saying thousands tells us nothing. Would it be possible to provide the committee later with the approximate number of businesses that do business with you, including in Quebec? I would be grateful, and I am sure that does not violate any confidentiality clause since it is aggregate data.

Do you know how many businesses in Canada or in Quebec benefit from these vaunted agreements between Mastercard, Visa and the federal government? Knowing that this is what you came here to talk about today, I imagine you are prepared and you know the number.

[Brian Peters]

In terms of the ballpark number for customers, I can give you a sense of the amount of the reduction for our standard flat rate customers. As I mentioned in my opening remarks, it totals across all of those users, the eligible ones, to less than one-tenth of one per cent of the total amount promised by the government, and on a per-business basis that averages out to less than $10 per business.

[Jean-Denis Garon, Bloc, Mirabel, QC]

Would I be correct to say that the average business that uses the services of Stripe has lower sales volume than the average business in Canada and that you have a niche occupied by smaller businesses?

[Brian Peters]

We serve a significant number of small businesses, but it's not our only niche. We actually serve very large enterprises as well. If you look at the customer base, it probably has this kind of curve.

[Jean-Denis Garon, Bloc, Mirabel, QC]

Do you understand where I am going with this? I am not generally a master of subtlety.

You are telling us that these vaunted agreements—which are no such thing, I reiterate, because the federal government bowed down to these multinational corporations—that they apply to, at most, about 10% of the total transactions for a company like yours, which may have clients that are smaller, on average, than the average business in Canada. Again, that amounts to saying that these agreements are insignificant. They do not affect most people, they do not affect most businesses, they do not affect most Quebeckers, and they do not affect most Canadians. The federal government goes around the country bragging that it has signed agreements that are essentially no more than smoke and mirrors and a way to mislead the public.

Is my analysis completely wrong?

[Brian Peters]

I may not express it the same way.

[Jean-Denis Garon, Bloc, Mirabel, QC]

Fine.

Mr. Chair, I have my answer.

[The Chair, Liberal, Joël Lightbound]

Thank you, Mr. Garon.

Mr. Masse, the floor is yours.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Mr. Chair.

Mr. Peters, I am just trying to figure out the value of what Stripe does for Canadians.

It has about 100 employees. Specifically, what types of employees do you actually have in your organization? What's the top job classification and description? Where do you post for employment for Stripe? You come from Washington, D.C., but I'm just wondering whether any of your Canadian operations post publicly for positions and what the predominant positions are.

[Brian Peters]

Our hiring in Canada is, predominantly, for engineers. We're a technology company. We—

[Brian Masse, NDP, Windsor West, ON]

What types of engineers?

[Brian Peters]

Oh, gosh. There are going to be all types. I'd actually love to follow up with you to make sure you get a better sense of that.

[Brian Masse, NDP, Windsor West, ON]

I really don't need you to follow up. I need, actually, information at this hearing right now.

Quite frankly, I find it offensive that we're supposed to follow up individually when this is actually a hearing here in the Canadian Parliament; you come in from Washington, D.C., and there's nobody capable in Canada to answer these questions, apparently.

If you're going to talk about engineers being the predominant positions, that's a broad category. It's not one that's.... Financially, in terms of your operations, I'd like to know what, specifically, those types of engineers are.

[Brian Peters]

I can try to address that.

Look, we have a number of products. Engineers may have distinct specialities, but oftentimes we're hiring to power a specific product or a specific expansion. There would actually be a variety of those. It's not that there is a specific business unit or product division that we are supporting solely with our Canada presence, so it really will be a mix.

I wish I could explain the different types of engineering talents that are out there, but that's just not my qualification. I would be happy to follow up and table it with the committee.

[Brian Masse, NDP, Windsor West, ON]

That's fair enough.

[Brian Peters]

That type of hiring is something we're proud of, and we'd be very happy to share it. I can't quite qualify—

[Brian Masse, NDP, Windsor West, ON]

I'm not trying to be difficult here, but I'm trying to drill down in terms of the cost and the profits, which won't be shared at this committee at this particular time. We're going to have to actually pursue that ourselves, I think, at this committee with regard to the value of Stripe for the Canadian economy, the types of positions, the remuneration and the value added. On top of that, it's going to be the cost recovery that we want to make for small and medium-sized businesses.

I'll conclude by saying that all that information should be made available to the committee, not through backroom lobbying. That might be the tradition or the culture you're used to in Washington, but it's not done the same way here in Canada.

[Brian Peters]

If I may respond, Mr. Masse, we've been publicly transparent about our pricing, unlike anybody else in the market. It's all on our website. I would be happy to discuss as much of this publicly as I can. I agree with you.

[Brian Masse, NDP, Windsor West, ON]

Then pull out the profits, the margins and all the things that we need as a committee to understand the value that Stripe and other types of organizations have for management of financial transactions. That's where we need to find out where Canadians can be protected the most and where small and medium-sized businesses can be more efficient.

Thank you.

[Brian Peters]

Thank you.

[The Chair, Liberal, Joël Lightbound]

Thank you, Mr. Masse.

Mr. Généreux, the floor is yours.

[Bernard Généreux, Conservative, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Thank you, Mr. Chair.

I also thank all the witnesses.

Mr. Peters, your answers amaze me. It is unbelievable. I am not ordinarily rude, but I have to say that you are probably the worst witness we have heard in any study.

[The Chair, Liberal, Joël Lightbound]

Mr. Généreux, I would nevertheless ask that you be polite. Your comment goes a bit over the line when it comes to the rules of courtesy that guide us at this committee. Please, get it together.

[Bernard Généreux, Conservative, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

The fact remains that it is unbelievable to be getting non-answers more than we get answers.

Mr. Peters, you are essentially saying that because you do not want to have two categories of clients, you keep the rate the same in order to have predictability over time, so people bear the same costs at all times. And yet lowering fees from $1.00 to $0.75 also allows for predictability. I do not understand what the difference is. You could have lowered the rates if you had wanted to, but you chose not to do it. It is actually unbelievable. I am going to stop here on your testimony.

Mr. Brownlee and Mr. Lampron, you said that some countries, including Australia and England, had lowered the rates to 0.5%, if I understood correctly. Have empirical studies been done to show that this rate reduction or the rate set in some countries helped small businesses? In Canada, this week is Small Business Week. It almost looks like the government handed out a gift, when that is absolutely not the case, as has been proved this morning.

I would like to hear Mr. Brownlee's answer first.

[Jeff Brownlee]

I don't know of any existing empirical studies, but it's common sense. Obviously, the lower the rates, the cheaper it is for the companies to process the cards and the better it is overall for the economy. That's basically what it comes down to.