Walmart Canada declines Visa, citing ‘unacceptably high’ fees

Wal-Mart Stores Inc. said it would stop accepting Visa Inc. cards at its stores across Canada, the latest salvo in an escalating battle between the two companies.

Following an evaluation of credit card transaction fees in both Canada and the rest of the world, the charges applied to Visa transactions were deemed to be too high, Walmart Canada said in a statement yesterday.

Walmart has some 370 stores in Canada. Walmart still allows customers to use the PIN technology, but banks and payment network operators recently adopted chip technology and prefer chip cards verified by signatures, and don’t see the need for the more expensive PIN technology. “Competition is extremely tough”. Canadian merchants have long grumbled about what they call the high interchange charges they pay credit card companies.

But MasterCard also offers lower rates to large retailers – as low as 1.26 per cent for those that have a minimum “net purchase volume” of $3 billion.

A representative from Walmart said the company chose to start in Thunder Bay because the stores in the northern Ontario city have the infrastructure to easily make the change.

“To ensure we are taking care of our customers’ best interests and delivering on our promise of saving customers money, we constantly work to reduce our operating costs, including credit card fees”, Walmart Canada said.

There are over 400 Walmart locations in Canada and over 11,500 locations worldwide, according to the company’s global website. So far there is no official time frame for when your local store will stop accepting it.

“Walmart made this business decision despite Visa offering one of the lowest rates available to any merchant in the country”, a Visa spokeswoman said in a statement.