New Interchange Programs
In July 2020, Visa, Mastercard, American Express, and Discover are implementing new interchange programs.
Merchant portfolios may need to be reviewed to prepare profitability models to support these new interchange programs.
Changes to Performance Tier 1 Fee Program for Visa Consumer Credit Transactions
- Performance Tier 1 will be renamed Performance
- Performance Tier 2 will be eliminated
- Performance Card-Not-Present will be introduced for consumer credit transactions
To qualify for Performance, retailers must have a minimum of $2 billion in total net VisaNet retail sales volume in Canada, a maximum fraud ratio of 0.07%, and a maximum chargeback ratio of 0.01%. This program applies only to electronic transactions.
New Industry Fee Utilities Program for Visa Consumer Credit and Debit Transactions
Visa will implement new Canada Industry Fee Utilities interchange programs that apply to Visa consumer credit and debit transactions from eligible merchants. To be eligible, a merchant must meet maximum service fee levels and must have Utilities (UTL) enabled in the boarding system.
New Emerging Segment Preferred Program for Visa Consumer Credit and Debit Transactions
Visa will implement the following Canada Emerging Segment fee programs that will apply to Visa consumer credit and debt transactions from eligible merchants. Eligible merchants include the following MCCs of any transaction amount:
- MCC 4900: Utilities
- MCC 6513: Real Estate agents and managers – Rentals
- MCC 9311: Tax payments
- MCC 8398: Charitable and Social Service Organizations
The following MCCs qualify if they transact amounts equal to or greater than CA$1000:
- MCC 8211: Elementary and secondary schools
- MCC 8220: Colleges, universities, professional schools, and junior colleges
- MCC 8351: Childcare services
Changes to Domestic Interchange Fee Programs for Account Funding Transactions
Visa will implement new Canada domestic Account Funding interchange fee programs that will apply to select proprietary card products:
Changes to Interchange Fee Programs for Visa Consumer Transactions
Visa will implement new interchange programs that will apply to purchase transactions from Visa consumer credit card products.
Changes to the Supermarket Credit Performance Tiers
Visa will replace the Supermarket Performance Threshold fee descriptors, fee program indicators (FPI), and rates. The new structure will expand acceptance to include Visa Signature, Visa Signature Preferred, and Visa Infinite.
Changes to Business Credit Interchange Fee Programs
Visa will support a new spend qualified tier interchange program for Business card transactions with a Product ID of G5 (Business Tier 5).
Enhancements to Intracountry Interchange Programs
Mastercard is enhancing the Canada Domestic Interchange Programs by lifecycling the existing consumer credit programs and creating new ones. They are also restructuring the commercial programs by setting them up as Small Medium Enterprise, Large Market, and World Elite Business.
New Mastercard Enterprise Solution Wholesale Travel Program Product Codes
Mastercard is expanding the Wholesale Travel Program by introducing 5 new commercial business-to-business (B2B) credit product codes and new commercial interchange programs in Interchange Rate Designators (IRD) BB.
New Commercial Credit B2B Product Codes and Interchange Program
Mastercard is expanding the Variable Interchange Program (VIP) by adding three new commercial product codes which will be supported in three new VIP interchange programs. Separately, Mastercard is creating a dedicated product code (BPC—Bill Pay Commercial) and interchange program (IRD X5—Commercial Bill Pay Standard) specifically for consumer bill payments that use commercial cards.
Revised Interchange Program and Rates for Assurance Framework
Mastercard is expanding the Merit 1 interchange program by introducing new consumer interchange programs that apply to Child Day Care Services (MCC 8351).
New Micro Ticket Interchange Programs
Discover will implement new Micro Ticket U.S.Consumer Acquirer interchange programs that will apply to transactions that are less than or equal to $5.00 for either card present or CNP transactions.