Mr. Speaker, the government recently released the finalized version of the Code of Conduct for the Credit and Debit Card Industry in May 2010. For more information, please visit www.fin.gc.ca/n10/10-049-eng.asp.
Businesses voiced real concerns about the lack of choice they have had in accepting debit and credit card payments, and about the costs involved. These added business costs are borne by merchants and may be passed on to consumers, which makes this an issue of importance to all Canadians. The code of conduct encourages choice and competition. It gives merchants the freedom to choose which card networks they use, helps them control their costs, allows them to pass on savings to their customers, and much more.
The government is particularly pleased that it was able to work constructively and cooperatively to launch this code with the financial service industry, consumer advocacy groups, retail /merchant advocacy groups, and other public interest groups. Prior to the release of the finalized code, the Minister of Finance met with a wide range of groups and organizations to discuss the state of the credit and debit card industry in Canada. Discussions focused on key issues such as transparency, disclosure, payment card branding and co-badging, as well as business practices in the industry.
Indeed, a draft code of conduct was released for a 60-day public comment period in November 2009. For more information, please visit www.fin.gc.ca/n08/09-109-eng.asp. During that period, all Canadians were invited to submit their views on how best to monitor compliance with the proposed code. Their views were taken into account when developing the revised code of conduct, which was released in April 2010. For more information, please visit www.fin.gc.ca/n10/10-029-eng.asp, and the aforementioned finalized version in May 2010.
Following is a small sampling of the reaction to the Code of Conduct:
Retail Council of Canada: “This is a solid victory for merchants across the country and a major step toward addressing imbalances in the Canadian payments system.”
Canadian Council of Grocery Distributors: “[The Ccode] is an important win for both merchants and customers … the Government of Canada deserve a great deal of credit for taking critical steps towards developing a Canadian payments system that is competitive, fair and provides clarity for both merchants and customers.”
Canadian Federation of Independent Grocers, CFIG: “The Code of Conduct is a very positive step and we are very pleased to note that many of the concerns CFIG has raised on behalf of independent retail grocers, such as negative option billing practices, have been heard and responded to, by the government.” Canadian Federation of Independent Business, CFIB: “the[(CFIB] welcomes today's announcement … This Code, which very closely resembles the Code put forward by CFIB in mid-2009, will help increase transparency and restore fairness to small businesses and consumers in their credit and debit card transactions … Today's announcement of a finalized Code constitutes an important step and is timely as we enter the summer season that is so vital to so many businesses, especially coming out of a recession … These developments will create a better future for merchants and help ensure a fair and transparent credit and debit card market instead of just letting large industry players call all the shots. Our organization applauds the implementation of this Code which will provide merchants with greater clarity and clout in changes to the debit and credit card market.”
Option consommateurs: “enthusiastically welcomes … the new Code of Conduct for Debit and Credit Cards by the Minister of Finance. [The Finance Minister] has listened to consumers and incorporated their interests in this new code … The new code guarantees consumer choice.”
Consumers Association of Canada, “welcomed the Code.”
Interac Association: “After a comprehensive consultation period with stakeholders, the Minister has developed meaningful and practical solutions that will effectively address significant concerns that have been raised by merchants and consumers about changes taking place in Canada's debit marketplace … It is clear that (the Finance Minister) has heard the concerns of merchants and consumers, concerns that we share, and has responded with an appropriate and pragmatic Code of Conduct … Without question, the Code helps build that by re-establishing choice and transparency in the marketplace for merchants and consumers, which we support.”
TD Bank Financial: “We believe that this Code will give merchants a greater voice in the payments market, while also balancing the interests of the other participants in this industry. This Code will provide greater pricing transparency for merchants and that’s a great outcome.”
Desjardins Group: “welcomes the Code of conduct for the credit and debit card industry … Merchants will now be better informed of costs associated with accepting credit and debit card payments and will be able to freely choose which payment options they will accept … These rules will foster healthy competition among service providers in the Canadian debit and credit card market.”
Vancouver Sun editorial: “We were pleased to see the code of conduct for credit and debit card markets introduced this month by federal Finance Minister … the voluntary code is an important step toward allowing merchants to have some control over costs and to maintaining a relatively low-cost cashless purchasing alternative that benefits consumers and retailers alike while still allowing for competition between providers.”