Posted on 18 September 2009
OTTAWA – Minister of Finance Jim Flaherty has ignored the recommendations of a bi-partisan Senate Committee report, as well as calls for action from Canada’s largest retail stakeholders, by refusing to take steps to ensure a level playing field in Canada’s debit card market, said Liberal Senator Pierrette Ringuette (New Brunswick) today.
“Unfortunately the Minister seems to be unaware that this isn’t an issue that he can afford to ignore,” said Senator Ringuette. “Visa and MasterCard have already taken steps to enter the Canadian marketplace with their own debit cards, and until this government takes action to ensure they’re operating under the same basic rules as Interac, it will be retailers and consumers that will suffer the consequences.”
Under the Canadian Payments Act, the Minister of Finance has the authority to deem Interac, Visa and MasterCard as Designated Payment Systems, ensuring that all three companies operate under the same guidelines. Without a level playing field, Canadians will encounter similar problems to those seen in the United States when Visa and MasterCard entered the debit market, and through aggressive marketing tactics, quickly scooped up 70% of the market share, which has since led to higher fees as competitors are shut down.
“Retailers are asking for action, consumers are asking for action, and a Senate Committee report, which was passed by both Conservative and Liberal Senators unanimously asked for action, and still the Minister of Finance refuses to exercise his authority,” said Senator Ringuette.
The Senate Committee on Banking, Trade and Commerce conducted an in-depth study on credit and debit card systems, with the report, Transparency, Balance and Choice: Canada’s Credit Card and Debit Card Systems, tabled on June 30, 2009. Recommendations within the report, including a call to establish an oversight board for the credit and debit card market, have been ignored by the government.
“All people are asking for is fairness, for all the participants in the marketplace to be playing by the same rules,” said Senator Ringuette.
“The Minister can achieve this now, without legislation, simply by exercising the powers he currently has at his disposal. Other jurisdictions have taken action, and Canadians can’t afford to be left behind.”
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For additional information:
Michael Gendron
Office of Senator Pierrette Ringuette (New Brunswick)
613-292-0699