Mastercard has announced that they are ending their preferred interchange rates for merchants who are a member of CFIB (the Canadian Federation of Independent Businesses) according to a recent update from both organizations.
Mastercard has been offering preferred rates to CFIB members on select card types, but they will be ending their agreement for members as of April 30, 2020.
As a result of this change, processors (including Helcim) will no longer be able to offer preferred Mastercard rates to new merchants who are CFIB members. If you are a CFIB member who is currently receiving the preferred rates with Helcim, your interchange fees will not be affected until the rates are discontinued on April 30, 2020.
When the preferred rates for CFIB members were first introduced, Helcim completed rate comparisons for merchants who wanted to compare their options for payment processing. We found that even before the CFIB discount, our Interchange Plus pricing could be more competitive than the rates offered by payment processors offering the CFIB rates using other payment pricing structures - such as tiered pricing. If you want to see how your current rate compares to Helcim’s pricing we would be happy to provide a price comparison to highlight any potential savings.
The CFIB and Mastercard partnership was originally announced in 2017 to align with the start date of an agreement made in 2015 between the federal government and Visa and Mastercard to reduce the interchange fees for all Canadian retailers for five. So while the CFIB preferred rate deal is ending, this new five-year agreement with Mastercard, Visa, and American Express to reduce the interchange rate charged to merchants by 10 basis points takes effect in 2020. You can learn more about that agreement here.
Interchange rates are regularly reviewed and adjusted, and all merchants who partner with Helcim for their payment processing will automatically benefit from rate reductions and any applicable savings related to this agreement because of our Interchange Plus pricing structure. For more on how Interchange Plus pricing works with Helcim, and how the interchange affects your processing rates, check out this article.
Payment providers who use other billing methods, such as flat rate pricing, don’t typically pass the savings on to their merchants. This is because their billing methods do not involve adjusting the final rate paid by the business owner to the fluctuating interchange rate, instead choosing to pocket the savings themselves.
Additional communication will be shared with impacted Helcim merchants who currently receive the CFIB rates by the end of 2019. If you have any questions about this change and how it might impact your business, please contact the Helcim Gurus for assistance.