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Harper Government announces code of conduct expansion to mobile payments


As mobile payments continue to take the economic world by storm, so too do the rules and regulations for such payments in Canada. In September, Ted Menzies, Minister of State, announced that the Code of Conduct for the Credit and Debit Card Industry in Canada will be expanded to include mobile payments. He also released a proposed Addendum to the Code for public consultation at this time.

This is big news for many Canadian retailers, who as of 2012 are still working hard to make mobile payments available to their customers. The benefits of mobile payments are tempting to both sellers and consumers alike. For one, mobile payments would limit the number of incoming credit card transactions. Such transactions cost companies in processing fees.

Mobile payments are also generally more convenient. Shoppers can simply log in to their accounts, and sellers will handle less cash and credit or debit receipts.

Lastly, an influx of mobile payments in Canada will also likely lead to higher sales. Starbucks, one of the largest coffee chains in the world, is the prime example of the kind of sales well-implemented mobile payment systems can bring. Since introducing their app-based mobile payments system in January 2011, Starbucks customers have conducted over 70 million mobile transactions. You don’t have to do the math to understand the kind of sales that are being made here. It’s no wonder, then, that Starbucks has invested a cool $25 million in Square, a San Francisco-based mobile payments company. The coffee chain will begin rolling out Square Wallet mobile payments to eager consumers in November of this year.

Ted Menzies seems keen on the kind of economic and technological innovation mobile payments promise to bring. “Technology continues to evolve and transform our daily activities—including the way we buy items. More and more Canadians are using their smartphones to pay at stores and small businesses, and that trend will grow,” noted Minister Menzies.

But what about mom and pop shops who may not want to adopt this technology and who may not have a customer base interested in using this means of payment? It would seem that Menzies has them in mind, too. “While we support new and convenient payment options, small businesses and consumers should not be punished with new hidden fees or undisclosed conditions.”

The objective of the proposed Addendum is to ensure that transparency and fairness are upheld for payments that access debit or credit accounts through a mobile device at the point of sale. It also endeavors to ensure even competition across the country. In short, the Addendum should ensure that both retailers and consumers are protected from criminal activity or the unwanted sharing of sensitive financial data such as credit card or bank account numbers.

The Code of Conduct for the Credit and Debit Card Industry in Canada was rolled out in August 2010 in an effort to aid retailers and consumers understand the costs and benefits of credit and debit card systems. Since coming into effect, the Code has helped to promote fair business practices.

The Addendum to the Code has been proposed as a response to the Task Force for the Payments System Review’s final report, released to the public in March 2012.

“Today’s actions are welcome. They show that the Code can evolve, and will address some of the reforms needed to continue to level the playing field between payments operators and small business,” said Corinne Pohlmann, Vice-President, National Affairs for the Canadian Federation of Independent Business.

The Addendum will be circulated for a 60-day period, during which Canadians are invited to submit their views and concerns. Comments may be submitted to

Albertine Watson
Metric Marketing

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