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Mastercard, Visa Raise Tap Limits, And Stores Want Interac To Follow

More people are using credit cards, which has retailers seeking relief.
A touchless transaction is seen here in this undated stock photo. Credit card purchases cost retailers more than debit or cash.
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A touchless transaction is seen here in this undated stock photo. Credit card purchases cost retailers more than debit or cash.

TORONTO — Tapping to pay with a debit or credit card can make life a lot easier, especially when people are concerned about germs causing disease.

Last week, Mastercard announced it was enabling higher limits for contactless transactions in response to the COVID-19 pandemic. The new limit of $250, up from $100, will make it easier for Canadians to pay for their groceries without risking contamination from touching a keypad or cash.

Visa is reportedly doing this as well, setting the stage for an environment where more people can tap to pay while keeping their hands clean.

Karl Littler, senior vice-president of public affairs for the Retail Council of Canada, told HuffPost Canada this is a good thing for both consumers and retailers.

“In general, I think it’s a positive because obviously we are encouraging people, where possible, for less contact to use tap.”

However, Littler warned consumers may not see this higher limit everywhere as banks and primary issuers must sign off on this move in order for it to go into effect, and some terminals may need to be updated.

Littler said these credit card companies are “doing the right thing,” but he would like to see others hop on board, as well.

“We would like Interac to go the same route,” he said.

That’s because credit is more expensive for merchants than debit or cash, making Interac transactions preferable for most businesses. However, there are many parties involved in debit transactions, and Interac is not prepared to make any immediate changes at this time.

“Interac Flash transaction limits will remain unchanged in order to maintain a secure, reliable and consistent payment experience for Canadians at a time when they rely on it the most,” Rebecca DeLuca, Interac’s external communications manager, said in an email. “Implementing such large-scale industry changes, including in-person site visits to make any necessary changes to point-of-sale terminals, is not recommended during this pandemic crisis.”

Contactless debit transaction limits are already higher in Canada than other parts of the world, Interac said, adding there are no chargebacks to the merchant, unlike credit card transactions.

“With contactless payments like Interac Flash top-of-mind for both consumers and businesses, we’re in conversations with our partners to enhance payment options like enabling contactless payments where they may not currently be accepted,” Interac said on their website.

“We are concerned about the preponderance of credit card payments.”

- Karl Littler, Retail Council of Canada

The Retail Council of Canada represents 45,000 storefronts or 70 per cent of retail in Canada. Littler said people are buying a lot of stuff online these days and retailers are seeing more credit card transactions than normal, which is why they’re looking for some relief.

“We are concerned about the preponderance of credit card payments,” Littler told HuffPost.

While touchless transactions might be convenient, it isn’t for everyone. Some people refuse to use it, citing security concerns.

And for those who think cash is king, think again. Retailers will accept cash if that’s all the customer has, but it’s not the best option for keeping things sanitary.

Like other surfaces, there are concerns that viruses can survive on banknotes. They can spread germs, exposing people to contaminants they would avoid by using others forms of payment. And cash creates change, including coins, which means more surfaces are being touched.

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