OTTAWA — More than 78 per cent of business owners have said credit-card processing fees are unaffordable for their business, according to a survey conducted by the Canadian Federation of Independent Business (CFIB). This has been made worse by the pandemic-driven shift to digital payment methods.
In addition, small businesses are less likely to have dedicated experts to manage their finances. Fifty-four per cent of businesses have difficulty understanding their contract with their payment processor and 41 per cent are unsure of their pricing model.
Throughout the pandemic, 92 per cent of small businesses now accept debit/credit cards as payment, 55 per cent started accepting or increased their acceptance of contactless debit or credit card payment, 33 per cent started accepting or increased their acceptance of online/e-commerce payments and 53 per cent decreased or stopped accepting cash as payment.
That said, the CFIB is calling on the federal government and payments industry to help small business owners by:
• Lowering the average overall cost of credit-card fees and ensuring that small merchants benefit from similar pricing as larger ones as promised by government in the 2021 federal budget;
• Simplifying contracts and monthly statements by having different credit-card processors use consistent wording and format;
• Creating an independent dispute resolution process for merchants who have issues with their payments, and;
• Eliminating credit-card processing fees on sales tax (HST/GST/PST).
“The cost of doing business is at an all-time high, and small businesses are finding it more and more difficult to deal with accumulating credit-card fees as consumers shift away from cash payments due to the growth of e-commerce and even for small, in-store purchases,” says Corinne Pohlmann, senior vice-president of National Affairs at CFIB. “Consumer preferences are leading more businesses to adopt digital payment methods, but many of them come with significant processing fees. Some of these costs will inevitably be passed down to consumers, but businesses also worry about pricing themselves out of their markets. As we start to come out of the pandemic, the payment services industry and government have an opportunity to do the right thing and address the unique needs of small businesses by finding ways to level the playing field and lower processing fees.”
