Visa and Mastercard Make Big Changes to Canadian Interchange Rates

the logo of VISA and Mastercard partially on top of each other

In July 2020, Visa and Mastercard made significant changes to the Canadian Interchange Rates.

The rate changes covered a broad spectrum of areas including adjusting individual interchange rates, removing specific market rates, and renaming card types. 

When the card brands make these types of adjustments, businesses that have partnered with a payment processor that offers Interchange Plus pricing, like Helcim, will automatically benefit from the reduced rates. With the July 2020 changes specifically, Helcim retail merchants that mainly accept card-present payments are now spending less on their credit card processing because of the reduced rates.

Unfortunately, if your payment processor offers flat rate pricing you will not see the lower processing rates reflected on your monthly statement because these processors do not adjust the rate you pay for each individual processor the same way payment processors offering Interchange Plus pricing do. 

Visa Canada Updates

The update released from Visa Canada includes an overall reduction in many of their interchange rates by a small margin. The company has also removed their emerging market rates which means that special pricing is no longer available for schools, colleges, daycares, and other businesses that were previously included in this category.

Below you can review some of the adjustments that Visa has made to their interchange rates. For a complete list of the updated interchange rates, you can visit our website here. Visa Interchange CategoryInterchange Rate – October 2019Interchange Rate – July 2020Swipe/Chip Consumer1.42%1.25%Swipe/Chip Infinite1.61%1.57%Swipe/Chip Infinite Privilege2.08%2.08%Keyed Consumer1.52%1.45%Keyed Premium1.71%1.70%Keyed Infinite Privilege2.45%2.45%Recurring Payment – Consumer1.37%1.25%Recurring Payment – Infinite1.56%1.53%Recurring Payment – Infinite Privilege1.95%1.95%

Mastercard Canada Updates

The changes released by Mastercard are more extensive than the adjustments made by Visa. We will breakdown the details for each change in the charts below. Mastercard has also updated its card-types and introduced new cards called Core, World, World Elite, and Muse. 

Similar to Visa, they removed emerging market rates for charities, schools, colleges, and daycares. They have also removed special rates for grocery stores, gas stations, superstores, and other businesses previously included in this category have been removed. Finally, Mastercard also removed their Independent Business Everyday rates and CFIB rates. These changes reflect a move to a simplified rate structure for all business types. 

For a complete list of the most up-to-date Mastercard Canada interchange rates, please visit our website here

Card Present Rates

A notable update from Mastercard is the reduction of card-present rates, including additional reductions in rates for contactless payments. Mastercard Interchange CategoryInterchange Rate – October 2019Interchange Rate – July 2020NFC / Tap&Pay Core (previously Consumer)1.30%0.87%NFC / Tap&Pay World (previously High-Spend)1.42%1.16%NFC / Tap&Pay World Elite1.86%1.48%NFC / Tap&Pay Muse (new)-1.57%Chip Core (previously Consumer)1.30%0.92%Chip World (previously High-Spend)1.42%1.22%Chip World Elite1.86%1.56%Chip Muse (new)-1.65%

Card-Not-Present Rates

Keyed rates for card-not-present transactions have been adjusted and Mastercard has introduced two categories for keyed transactions: ecommerce and manually keyed. This change will reward businesses that have invested in ecommerce tools and online stores for their payments. Mastercard Interchange CategoryInterchange Rate – October 2019Interchange Rate – July 2020E-Commerce Core (previously Consumer)1.89%1.76%E-Commerce World (previously High-Spend)2.05%2.00%E-Commerce World Elite2.50%2.24%E-Commerce Muse (new)-2.39%Keyed Core (previously Consumer)1.89%2.06%Keyed World (previously High-Spend)2.05%2.30%Keyed World Elite2.50%2.54%Keyed Muse (new)-2.69%

What Does This Mean For Your Business?

Knowing when and how the card brands have adjusted their rates can help you understand changes in your monthly statement. The adjustments made by Visa and Mastercard this summer can also highlight which types of payments and tools can help you save on your payment processing while still delivering a great experience to your customers. 

Notable payment trends from this card brand update include lower rates for card-present NFC (Tap and Pay) transactions compared to chip and PIN transactions and lower rates for card-not-payment ecommerce payments compared to keyed payments. You can apply this knowledge strategically to adjust the way you accept payments. 

For example, ensuring you have an NFC enabled terminal for in-person payments or setting up an online store or a hosted payment page instead of accepting payments over the phone can ensure you’re capturing potential savings whenever possible. 

As long as your payment processor offers Interchange Plus pricing, you will automatically benefit whenever the card brands lower their interchange rates, no matter how you’re accepting payments. You don’t need to do anything to get the new rates, this is just one of the benefits of partnering with a processor like Helcim who is committed to providing more affordable pricing. 

Ready to Switch to Helcim? 

If your business needs to accept credit and debit cards in person or online, Helcim provides honest, transparent, and affordable credit card processing and is regularly reviewed as being among the best processors for small and medium sized businesses. If you have any questions or would like to learn more about how Helcim can help your business, contact our friendly Customer Service Team.

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