Interchange fees have come under increasing scrutiny

The fight, which emerged in June, stemmed from a renegotiation over how much Walmart would pay in interchange fees. These fees are collected from all merchants that accept credit cards as a method of payment, and are shared among credit card companies such as Visa and MasterCard, the banks that issue the credit cards, and credit card processors.

After a surprise weekend announcement by Walmart last summer that it would begin phasing out acceptance of Visa cards in its Canadian stores, Visa accused the retailing behemoth of using its own customers as “leverage” in an attempt to pay lower fees than others, including charities and schools.

In an open letter to cardholders and other merchants published in June, including in the National Post, Visa said the pair had been negotiating for months, with Walmart ultimately offered “one of the lowest rates of any merchant” in Canada.

For its part, Walmart said it was trying to keep fees and all its costs as low as possible to avoid passing them along to customers through higher prices.

Interchange fees have come under increasing scrutiny around the world in recent years amid complaints from retail and consumer groups, and even some politicians, who fear they ultimately drive up the cost of goods for consumers.

On Thursday, officials from both Walmart and Visa declined to say where the two sides landed on the interchange fees in their latest agreement.

“Visa doesn’t disclose confidential business terms,” Hindman said.

One industry source told the Post in June that Canadian banks that issue Visa cards had an incentive to urge the credit card company to go back to negotiations with Walmart. This person estimated the banks had $82 million in interchange fees at stake.

All was not quiet over the months the two companies were feuding. In November, Visa launched a promotion in Manitoba that seemed to be encouraging shoppers to buy their groceries anywhere but Walmart, where they could not use their Visa cards at the time. A $10 credit was given to cardholders who registered their cards and then made a purchase of $50 or more at a grocery store in Manitoba.

Disputes over interchange fees have led to government intervention to regulate the setting of the fees in some countries. This has not been the case in Canada where, in late 2014, the fees charged to retailers across Canada were voluntarily reduced after a series of negotiations.

However, retail and consumer groups have continued to complain that the rates in Canada outstrip those in Australia and parts of Europe.