Fees, pricing models and 2026 rules
The 2024 small business credit card fee reduction: who qualifies and how to check
What Visa and Mastercard's interchange reductions from 19 October 2024 mean for eligible Canadian small businesses, the thresholds, and how to see whether you got the saving.
From 19 October 2024, Visa and Mastercard lowered credit card interchange for eligible small businesses in Canada, under commitments announced by the Department of Finance. According to Finance Canada's announcement of 17 October 2024, eligible businesses saw in-store interchange on domestic consumer credit cards reduced to an annual weighted average of 0.95% and online interchange cut by 10 basis points, with interchange reduced by up to 27%. Eligibility is assessed per network: annual sales volume under $300,000 on Visa or under $175,000 on Mastercard. Whether your bill actually fell depends on your pricing model and on whether your processor passed the reduction on.
This guide is part of the fees and rules section. It summarises Finance Canada's announcement; check the current network rules for details that may have changed since.
The commitments in brief
| Item | What Finance Canada announced (October 2024) |
|---|---|
| Effective date | Saturday 19 October 2024 |
| Networks | Visa and Mastercard |
| In-store reduction | Domestic consumer credit interchange lowered to an annual weighted average of 0.95% for eligible businesses |
| Online reduction | 10 basis points (0.10 percentage points), described as a cut of up to 7% |
| Overall | Interchange reduced by up to 27%; more than 90% of businesses that accept credit cards expected to receive lower rates |
| Eligibility | Annual sales volume below $300,000 (Visa) or below $175,000 (Mastercard), assessed separately for each network; eligible non-profits included |
| Other | Free access to online fraud and cybersecurity resources for qualifying businesses |
| Government estimate | About $1 billion in savings for eligible small businesses over five years |
The same announcement confirmed that the revised Code of Conduct would take effect on 30 October 2024, with obligations needing complex technical changes due by 30 April 2025. See merchant rights under the Code.
What "weighted average" means for you
A weighted average across a network's interchange categories does not mean every credit card sale costs 0.95% in interchange. Premium cards may still carry more than standard cards; the average is weighted across eligible merchants' transactions. Your own average depends on the cards your customers use. And interchange is only one layer: network fees and your processor's markup sit on top. See interchange, network fees and markup.
Do you qualify? Check per network
Eligibility is assessed separately for Visa and for Mastercard, using annual sales volume on each network.
| Illustrative business | Annual Visa volume | Annual Mastercard volume | Eligible on Visa? | Eligible on Mastercard? |
|---|---|---|---|---|
| Bookshop | $90,000 | $50,000 | Yes | Yes |
| Café | $210,000 | $140,000 | Yes | Yes |
| Contractor | $280,000 | $190,000 | Yes | No |
| Furniture store | $420,000 | $240,000 | No | No |
Your statement should show volume by card brand. Add up twelve months. If you are close to a threshold, ask your processor how the network measures volume (for example, which twelve months and whether multiple locations are combined).
Did your processor pass it on?
Interchange-plus or subscription pricing. Interchange is passed through at cost, so the reduction should appear automatically in the interchange lines of your statements from late October 2024. Compare an October 2024 statement with a November 2024 one, adjusting for volume.
Flat or tiered pricing. The processor pays lower interchange, but your rate stays the same unless the processor lowers it. Finance Canada said it expects processors to pass savings directly to small businesses. Under the revised Code, processors must notify eligible merchants if network fee reductions are not passed on in full, and remind them of their right to end the contract and move to a processor that does pass on the savings. A reduction not passed on in full also opens the Code's 70-day penalty-free exit.
Worked example: what the saving looks like
Finance Canada's own illustration: a store processing $300,000 in card payments pays nearly $4,000 a year in interchange and could save $1,080 a year; a $120,000 bookstore could save $432. Both figures imply a saving of about 0.36% of volume.
An illustrative café on interchange-plus with $150,000 of annual Visa and Mastercard credit sales:
- Before: average interchange (illustrative) 1.31% → $1,965 a year.
- After: average interchange (illustrative) 0.95% → $1,425 a year.
- Saving: $540 a year, all of it visible on an interchange-plus statement.
The same café on a flat 2.65% plan would pay $3,975 in both years unless the processor lowered the rate. Use the card fee calculator to rerun your own months.
What to do if you do not see a saving
- Confirm eligibility per network from your statements.
- Check your pricing model in your agreement.
- Ask your processor in writing whether the reduction applies to your account and how it is reflected.
- If a reduction was not passed on in full, check whether you received the required notice and the date your 70-day exit window ends.
- Collect quotes from processors that pass interchange through, using the quote checklist.
- If you think the Code was not followed, use the processor's complaints process and contact the FCAC.
Current status in 2026
The October 2024 commitments are the most recent federal interchange measures for small businesses that this site has confirmed on Finance Canada's website. In December 2024 the Minister of Finance also appeared before the House of Commons industry committee on its study of credit card practices. Check Finance Canada and the networks for any later changes before relying on these figures.
FAQ
Does the reduction apply to American Express?
The Finance Canada announcement of October 2024 covered Visa and Mastercard. Other networks have their own pricing; ask your processor.
Does it apply to debit?
The commitments concern credit card interchange. Interac debit is priced separately; see Interac debit fees.
I sell only online. Did I benefit?
Online interchange for eligible businesses was cut by 10 basis points. On $100,000 of online sales, that is about $100 a year if fully passed on.
Sources
- Department of Finance Canada — "Government reduces credit card fees by 27 per cent for small business owners" (17 October 2024)
- Financial Consumer Agency of Canada — revised Code of Conduct and merchant rights
- Visa Canada — interchange information
- Mastercard Canada — interchange information
- House of Commons committees — industry committee study of credit card practices
