Walmart Canada and Visa have reached an undisclosed agreement on credit card fees that the retailer faces from the credit card company. The agreement comes months after Walmart banned the payment form in select stores in Canada. However, Walmart still believes credit card fees are too high, according to The Wall Street Journal.
Walmart Canada announced it would begin phasing out Visa cards as an acceptable form of payment in some of its retail stores in July 2016. The company’s disagreement with the credit card company stemmed from the costs associated with accepting Visa card payments, according to a June 14 Hardware Retailing article.
While the ban didn’t affect all 408 Walmart Canada stores, Visa cards were “banned from 19 stores in remote areas of Canada,” The Wall Street Journal says. The ban began in July at three stores in Thunder Bay, a town of 120,000, and then expanded to another 16 stores in Manitoba in October, according to The Wall Street Journal.
While neither Walmart nor Visa revealed details of the agreement, Randy Hargrove, a Walmart spokesperson, tells The Wall Street Journal that “we continue to believe the fees charged by Visa and other credit card companies are too high.” The agreement reinstated Visa as an acceptable payment form in the previously banned stores late last week, according to The Wall Street Journal.
However, the deal may lead to higher costs for smaller businesses in the country, according to The Guardian. The Canadian Federation of Independent Business president, Dan Kelly, shared concerns for what the deal would mean for small businesses.
Kelly says that a good deal for a big-box company like Walmart can greatly impact smaller companies, “as Visa and banks could look to make up the difference by raising the merchant fees charged to other companies.”
Although Visa didn’t comment on the deal, The Wall Street Journal says in the months prior to the ban being lifted, the credit card company launched a marketing effort to keep customers. Visa offered affected Walmart customers gift cards if they used Visa with other retailers.