The Consumers Association of Canada has stepped into the debate over credit card fees, supporting Visa and MasterCard's opposition to surcharges for paying by credit card.

The Consumers Association of Canada has joined Visa and MasterCard in opposition to surcharges for paying by credit card. (Paul Sancya/Associated Press)

The CAC takes that position based on a survey of 916 credit card holders who were questioned about paying an extra fee, in November 2009.

According to the survey — conducted during consultations over a code of conduct for the credit and debit card industries — 75 per cent of Canadians are strongly opposed to paying such a fee.

When asked about paying an additional 3.5 per cent for the convenience of paying by credit card, 80 per cent of those surveyed strongly opposed the idea.

The margin of error on the Angus Reid survey was plus or minus 3.2 percentage points 19 times out of 20.

'Canadians are overwhelmingly opposed to the suggestion that they should have to pay merchants for the privilege of paying them.'—Bruce Cran, Consumers Association of Canada

"The results speak for themselves," said CAC president Bruce Cran. "Canadians are overwhelmingly opposed to the suggestion that they should have to pay merchants for the privilege of paying them."

Many merchants are upset over credit card fees, which can be as high as 3.5 per cent of the purchase price. MasterCard and Visa prevent retailers from charging consumers a premium to use their cards.

Calling the situation "uncompetitive," Melanie Aitken, Canada's competition commissioner, last week announced she is taking Visa and MasterCard to a tribunal in an attempt to change how the companies are paid for the use of their cards.

Campaign encourages cash, debit payments

On Friday the Canadian Federation of Independent Business announced it will launch a campaign in the new year, encouraging consumers to pay for their purchases with cash or debit cards.

The CFIB also fired off a letter to Visa and MasterCard asking if the campaign would violate agreements merchants must sign.

"If they come back to us and say merchants are not allowed to even encourage customers to pay with a lower cost payment method, then they're demonstrating to the Competition Bureau and to us in the public that they do have these very restrictive rules that the Competition Bureau is criticizing," CFIB vice-president Dan Kelly told CBC News.

In a statement to CBC News, MasterCard said merchants are free to offer discounts or other inducements to customers who pay cash or with a debit card. They just can't add a surcharge.

"How can a merchant complain that discounting at the checkout if a consumer pays with cash or debit is too complicated to implement, and then turn around and embrace surcharging," asks Cran.

"Merchants should be careful what they wish for," he said.

The CAC notes that in Australia, where surcharging is allowed, some merchants have turned the practice into a new revenue stream. It points to one airline in Australia that charges an additional $30 per ticket when paying by credit card.