Thoughts on Credit Card Surcharges

Back in the fall of 2022, credit card surcharge changes came into effect. Basically, Canadian businesses are now able to pass on credit card surcharge to their customers. The real question was how many merchants would decide to pass on the fee?

Rule change

The new rule allows merchants to charge consumers “interchange or swipe fees” for every transaction, commonly known as payment processing fees. The processing fee percentage will depend on the type of credit card that the cardholder has, but it can be no higher than 2.4%. For example, if a person was buying something for $100, plus applicable taxes. Let say it now cost $110 to purchase the item and the credit card fee is 2%, that means the person will need to pay $112.20 ($110 + 2%) if they choose to use their credit card. Otherwise, the business would need to pay the 2% fee, which would have been factored in the $110 that they collected. Either way, someone is paying for it.


I have been asked for my thoughts on the fees several times and I procrastinated a little with a post as I wanted to see how things played out. It has been about 4 months, so there is some data to work with.

Charging an extra surcharge with customers is nothing new. You may have noticed many utility companies or government bills already doing this if we choose to pay their bill with a credit card. The main difference now is that businesses can also use this practice.

So far, I have yet to pay a bill with that required me to pay the surcharge separately. But that does not mean the business did not recover that cost from me.

I have avoided being too political on this blog, but there is an argument to be made that some businesses might be using: “supply chain issues, staffing issues causing high wages and inflation” as reasons to do a higher markup on their prices than they otherwise would have done. In which case, it would be easy recover any surcharge costs during their price increases, so that they do not need to “show” the consumer that it is a separate cost. Just make it all inclusive!

However, some retailers may rather show it as a separate cost item, so then people will feel they are getting a discount when they are not using their credit card. It goes both ways, it just depends on how you see it.

At the end of the day, I feel that supply and demand will determine the prices that we pay. Whether the surcharge is transparent or embed, either way, business will want to find a way to recover that cost. Personally, I worry about the overall cost (instead of how it is broken down) that I am paying for something go from there!

What are your thoughts about this new transparency of these processing credit card fees? Please us know in the comment section below!


  1. In west end Toronto, I have not particularly noticed surcharges being applied anywhere. What I have seen is a variety store that asks for a flat $0.25 to use a credit card – and they did that before this legislation. And also a restaurant that offers deals on meals over $50.00 if paid with cash.

    1. Thanks for sharing Stephen. Interesting. I feel like 25 cents for any transaction is a reasonable enough fee that people may pay it without a flinch!

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