Evidence of meeting #142 for Industry, Science and Technology in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was customers.
A recording is available from Parliament.
Head, North American Retail & Small Business Payments, Bank of Montreal
When we do product pricing, we do consider a range of factors because we have to ensure that we're operating competitively and bringing the best products to our customers.
Executive Vice-President, Cards, Payments & Transformation, Royal Bank of Canada
The card product is different from other lending products in the sense that you can use it anywhere. It helps almost grease the wheels of commerce, whether you're tapping it at the transit station or whether you're travelling abroad and using it somewhere else. There are various benefits associated with cards. With the value, convenience and choice that are provided to the customer, a credit card is a different product, and we make sure, even within the credit cards, that we provide that choice to let the customer choose what kinds of cards they want based on their needs.
Senior Vice-President, Credit Cards, Canadian Imperial Bank of Commerce
Similarly, I would say that we are in the business of providing advice to our clients. We want to make sure that our clients have the right products to meet their needs.
Liberal
Vance Badawey Liberal Niagara Centre, ON
I guess, quite frankly, you all have the same answer to some extent.
My next question is based on that. Do you secure loans at less than $10,000?
We'll start off with Scotiabank.
Senior Vice-President, Retail Payments & Unsecured Lending, Scotiabank
You could have a secured loan on something like a used vehicle, yes.
Executive Vice-President, Canadian Card Payments, Loyalty and Personal Lending, TD Bank Group
Sorry, but I'm not sure I understand the question.
Liberal
Executive Vice-President, Canadian Card Payments, Loyalty and Personal Lending, TD Bank Group
Yes, we do.
Head, North American Retail & Small Business Payments, Bank of Montreal
It's not my area, but I do believe that we do.
Executive Vice-President, Cards, Payments & Transformation, Royal Bank of Canada
I have a similar answer. It's not my area, but I believe we do.
Liberal
Vance Badawey Liberal Niagara Centre, ON
Okay.
You mentioned earlier that the networks establish the rates. Who is the network?
We'll start off with Royal Bank.
Executive Vice-President, Cards, Payments & Transformation, Royal Bank of Canada
The network is Mastercard and Visa.
Liberal
Vance Badawey Liberal Niagara Centre, ON
They're actually the network that establishes the rates, not the network that manages the rates, but establishes the rates.
Executive Vice-President, Cards, Payments & Transformation, Royal Bank of Canada
Establishes the rates, yes.
Executive Vice-President, Cards, Payments & Transformation, Royal Bank of Canada
I don't know what you mean by manages, but establishes and provides the rates.
Liberal
Vance Badawey Liberal Niagara Centre, ON
Okay, thank you.
This is my last question. I think I heard a similar question earlier, but I just wanted to get clarification. What is the justification for interchange fees and the percentage received by banks on every transaction fee?
Once again, I'll prompt. Let's start off with CIBC.
Senior Vice-President, Credit Cards, Canadian Imperial Bank of Commerce
Once again, CIBC is not responsible for setting interchange rates or for justifying what those rates are.
I would say that businesses benefit from the use of credit cards, and our banks provide authorizations for their confidence that they will be getting settled on a transaction, and we transfer any risk related to that transaction to the credit card issuer. The merchants also have a faster checkout line with reduced cash handling time by using credit cards. They also are enabled for e-commerce by using credit cards. There are benefits to businesses for accepting credit cards.
Liberal
The Chair Liberal Joël Lightbound
Thank you, Mr. Badawey. You're out of time, and I doubt you'll get wildly different answers from all the banks, so we'll move on.
Mr. Savard‑Tremblay, you have the floor.