27/01/2010 -
Many businesses whose merchant services include debit and credit card processing may feel burdened by the transaction fees imposed by banks and credit card issuers. Yet merchants take heart: Some of the costs associated with payment processing may be negotiable.The Wall Street Journal reported that merchants "should sit down with their bank - or, in the case of AmEx and Discover, a third-party acquirer - over their 'merchant discount' rate, which may include service fees such as transaction processing, terminal rental and customer service."
However, the Journal noted, transaction fees from Visa and MasterCard are generally non-negotiable.
These transaction fees, also known as interchange rates, have seen a significant amount of media attention recently as they play a major role in the code of conduct for debit and credit card processing proposed by Finance Minister Jim Flaherty, as well as in the entry of MasterCard and Visa into the Canadian debit card market.
Merchants are worried that MasterCard's and Visa's presence in the market will challenge the low-cost Interac network for market share - forcing them to pay higher transaction fees - while the card companies attest that the competition will benefit consumers and merchants alike.

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