Smallernfreuden by Biggenbanken is Hurtenvendors

Have you seen that Visa ad where a couple at a hockey game pays for a snack using a Visa card?

By Amber Ruddy

Have you seen that Visa ad where a couple at a hockey game pays for a snack using a Visa card? You know, the one that touts the “joy of small”?

Smallenfreuden is a made-up word that is used to describe purchases of $100 or less made on your credit card.

Well there is another side to the story, that of independent business owners.

The Canadian Federation of Independent Business (CFIB) is pushing back and sharing the reasons why you should not use credit for “the small purchases you would make anyway”.

To start, every time you pay with a credit card at your local restaurant, dry cleaner, craft store, or other business, the credit card company pockets as much as two to three per cent of the purchase.

Compare that to using cash or debit. When you use INTERAC, the cost to process the transaction is a flat fee; just a few cents per transaction. Does it really cost more to process the transaction of a stick of gum versus a television set? Or is this a case of the middleman taking a cut?

Banks and card companies bring in a whopping $5 billion a year from credit card processing fees and are looking to grow that by launching into the world of small purchases.

As more uber-premium credit cards hit the market, additional perks including cash back and extra points have to be covered by someone and business owners are the ones picking up the tab.

Currently, there is no way for a merchant to know by looking at the card whether it will carry a regular or high transaction fee.

Hardworking small business owners really feel the pain more than big businesses.

To remain competitive many businesses absorb the cost, but ultimately the merchant may deal with the hidden cost by hiring fewer staff, reducing or eliminating pay raises for employees, and in some cases raising prices.

Businesses are loath to take away options for customers. But it is important to understand how transaction fees can have a major impact on the profitability of many small businesses. Armed with this knowledge, consumers can make informed decisions when they pull out their wallet at the checkout counter.

At the end of the day, biggenbanken loves it when you smallenfreudan. Every time you use credit cards for small purchases, it is definitely hurtenvendors.

Amber Ruddy is the Alberta policy analyst with the Canadian Federation of Independent Business. She may be reached at amber.ruddy@cfib.ca

Just Posted

Supporters rally for Jason Kenney as UCP leader stops in Red Deer

Kenney promises equalization reform, stopping ‘Trudeau-Notley’ payroll hike, trade, economic mobility

Sylvan Lake anglers reminded to remove ice huts before spring thaw

Anglers have until March 31 to remove their structures from the surface of the ice

Protect your pets from ticks, says Sylvan Lake vet

The number of ticks in Alberta has increased, and has put people and pets in danger of Lyme disease

Check online to make sure you’re registered to vote in upcoming provincial election

Advance polls open Tuesday, April 9th to Saturday, April 13th

NDP Leader Rachel Notley stops in Red Deer on campaign trail

Notley promises hospital expansion, cath lab, pipelines and energy industry expansion

VIDEO: Restaurant robots are already in Canada

Robo Sushi in Toronto has waist-high robots that guide patrons to empty seats

1,300 cruise ship passengers rescued by helicopter amid storm off Norway’s coast

Rescue teams with helicopters and boats were sent to evacuate the cruise ship under extremely difficult circumstances

B.C. university to offer first graduate program on mindfulness in Canada

University of the Fraser Valley says the mostly-online program focuses on self-care and well being

Sentencing judge in Broncos crash calls for carnage on highways to end

Judge Inez Cardinal sentenced Jaskirat Singh Sidhu to eight years

‘Families torn apart:’ Truck driver in fatal Broncos crash gets 8-year sentence

Judge Inez Cardinal told court in Melfort, Sask., that Sidhu’s remorse and guilty plea were mitigating factors

WestJet sticking with Boeing 737 Max once planes certified to fly

WestJet had expected to add two more of the planes this year to increase its fleet to 13

Fierce house cat spotted as ‘aggressor’ in face off with coyote in B.C. backyard

North Vancouver resident Norm Lee captures orange cat versus coyote in backyard showdown

Wilson-Raybould to reveal more details, documents on SNC-Lavalin affair

Former attorney general has written to the House of Commons justice committee

Most Read