Major banks and telecommunications companies are teaming up to allow for mobile transactions. These mobile payments will make it easier for many consumers to make payments, no matter where they go. However, there are some concerns. While there hasn’t been mention of extra fees yet, the possibility is always there.
Canadians Don’t Need More Fees
The CFIB points out that the premium card debacle is good reason to be concerned, since small businesses are still trying to work through that problem. Here is what the CFIB states about coming mobile transactions:
While CFIB is in favour of giving customers and businesses more options, the addition of new payment methods shouldn’t be used as an excuse for a fee grab.
It’d be nice if the logical conclusion was to simply let consumers have the option to pay with whatever method they like. However, it’s not a foregone conclusion. Already, premium cards drive up prices for everyone — even those who don’t use the credit cards — because small businesses have to cover the high costs of accepting premium cards. Small businesses often find themselves in a difficult position, since not accepting credit cards could lead to lost business. Accepting the cards, though, means that they have to absorb higher costs, or pass the higher costs on to customers.
Hopefully, the introduction of mobile payments won’t add yet another layer of costs for consumers. The truth is that Canadians already pay rather high fees for credit card use. In fact, Canadians pay some of the highest fees in the world. And that doesn’t even take into consideration the higher than average interest rates charged on Canadian credit cards (higher, on average, than the interest charged in the United States). Canadians are already hit with enough fees. Yet another transaction fee for mobile payments would push the situation into the realm of the ridiculous.
The good news is that proactive measures are already being taken. Here is what the CFIB points out about what’s being done right now:
So far, the industry is reaching out to small business, and there are new guidelines for mobile payments. Even better, federal Finance Minister Jim Flaherty has indicated he will soon implement a payments advisory committee, and he’s considering changes to the Code of Conduct for the Credit and Debit Card Industry (which we helped to draft) to address mobile issues.
Hopefully, the big banks and the communications companies will handle this matter better than the introduction of premium credit cards was handled. With a little push in the right direction, we have have more convenience without being overwhelmed by fees.