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Visa Canada has just announced a new Service Fee Program in Canada.

This allows Canadian merchants of certain industries to charge a "Service Fee" to their customers for using a Visa Credit or Visa Debit card. This program is limited to card-not-present transactions, which means that surcharging for payments made in-person is still prohibited. Discretion is advised when doing this, however, as there are trade-offs when charging your customers more, to save on processing costs. There are also some limitations to this new Service Fee.

How Does This Change Your Business

For any small business owner that processes any online payments, you can essentially now avoid the fee that Visa and Mastercard apply to you for accepting credit cards. Much of the time, these fees eat into profit margins and now they can be offset to the customer. 

The eligible merchants are:

6513Property Management / Rent
8220Universities and College for transactions greater than CAD $1,000
8211Private Elementary & Secondary Schools for transactions greater than CAD $1,000
8351Childcare for transactions greater than CAD $1,000


Visa has set some rules around the program, including:

  • The service fee is available for transactions in card-not-present environments only and is still prohibited for card-present (Chip & PIN and Swipe) transactions. Recurring transactions are permitted.
  • The maximum service fee that can be charged is 1.50% for Visa Debit Cards, and 2.50% for Visa Credit, Prepaid and International Cards.
  • The fee may not be identified as a "Visa Fee" or "Surcharge". The recommended terms are "Service Fee" or "Online Convenience Fee".
  • The fee may not be greater than the service fee charged on other card types. The fee must be the same for all types of cards (cannot charge more for premium cards for example).
  • The fee must be clearly disclosed to the customer before the transaction is completed and the customer must have the ability to cancel the transaction without penalty.
  • The fee must be recorded separately on the transaction receipt. This means that there should be one transaction for the original amount and one transaction for the surcharge amount
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