A fee increase for business owners who allow payments by Visa has small business owners across the country concerned.

The Visa fee increase will personally cost her more than $800 this year, says B. J. Sandiford. (CBC)

Fees for small businesses are going up from about three per cent for every transaction to between four and six per cent.

"Credit card companies are going to make it very difficult for me," said B. J. Sandiford, who runs the Happy Glass jewelry studio in Charlottetown.

"That's a substantial increase and it's a big concern to me."

Visa is calling it "a modest pricing adjustment" and notes it is the first time its fees have changed in five years. Dan Kelly, president of the Canadian Federation of Independent Business, takes issue with Visa's description of the increase.

"One-third increase in the slice that they get, so that's by no means modest," said Kelly.

"On top of that the fees for foreign card transactions are going to double. That's a huge increase for these merchants."

Cost of serving tourists will rise

Kelly said the higher foreign card transaction fee increase will be particularly hard on businesses that rely on tourists, which is a big part of Sandiford's market.

The Visa fee increase is far from modest, says Dan Kelly. (CBC)

"Those international tourists are going to come with their credit cards," he said.

"Every time a merchant accepts one of those credit cards, they're going to be dinged a significantly higher bill than they were just a couple of months earlier."

Sandiford has done the math. She operates the studio on her own, and she estimates the fee increase will personally cost her a little over $800 in the coming year.

"It's going to really strain the way I do business. I don't know how I'm going to do business," she said.

The CFIB says consumers and small businesses do have options. Increasingly merchants are asking customers to use debit cards or cash to help them avoid credit card fees. Sandiford said that's an uphill battle. Most of her customers prefer credit, because it's easy.

Visa says the fee increase is necessary to update its network.

"Ongoing investment is required in our network to ensure the exceptional reliability, speed, innovation and security that consumers, merchants and issuers have come to rely on," the company says in a statement emailed to CBC News.

The higher fees, says the statement, will support Visa's investment in advancing electronic payments.