Industry Committee on Nov. 7th, 2024

[Nicolas Marion]

In our work, particularly that which led to the recent agreements with Visa and Mastercard that saw the reduction of interchange fees for small businesses—

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

Is that a voluntary agreement?

[Nicolas Marion]

It is a voluntary agreement, and—

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

Did you provide—

[Nicolas Marion]

Having said that, I'd qualify it as a non-regulatory agreement.

It is an agreement, and they adhere to it. They post the fees and—

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

Did the government provide direction to your department to not pursue a regulatory framework on interchange fees, and a voluntary framework instead?

[Nicolas Marion]

We've had three sets of these agreements over the years.

The first set was negotiated in 2014 and brought into force in 2015—

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

There's no formal regulatory framework. Is that correct?

[Nicolas Marion]

Those requirements are not set in regulations. That is correct.

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

Did the government provide you with direction to not pursue a formal regulatory framework for interchange fees being capped at a certain level?

[Nicolas Marion]

We didn't receive any direction saying that it shouldn't be done regulatorily.

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

Thank you.

Did the government provide you with any direction on working something into the voluntary agreement with Visa and Mastercard to ensure that savings from interchange fees would be passed on to small businesses when a payment processor is involved?

[Nicolas Marion]

Just to be clear here, at the time of the fall economic statement in 2022, the government announced its intention to negotiate—

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

I'm running out of time so I want to know—

[Nicolas Marion]

I appreciate that, but at the time, the draft legislation was tabled concurrently with the announcement, and the announcement said if we cannot achieve this through agreement, we will proceed with regulating this in the short term.

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

I'm asking particularly with regard to the payment processors like Stripe.

Has the government provided you with direction to ensure that the savings on interchange fees from the deal with Visa and Mastercard are actually passed down to consumers and not hoarded by payment processors?

[Nicolas Marion]

Right. Most merchants who are on Interchange Plus plans are, de facto, receiving—

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

We don't know how many there are of those. You get that talking point, but we don't actually know how many of those clients are on Interchange Plus or not.

I'm asking why, if that was to go to small businesses, the government didn't.... Did you provide advice to the government to ensure that those savings were not hoarded by payment processors like Stripe?

[Nicolas Marion]

We have communicated in very clear terms. The government—

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

Could you table that communication—anything written to the payment processors—with the committee?

[Nicolas Marion]

We've spoken with the payment processors. Our expectation was that for any rate reductions—

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

Did you do that with Stripe?

[Nicolas Marion]

We did, absolutely.

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

Can you table that? It was last week, you said.

[Nicolas Marion]

No, I said “absolutely”.