The Hidden Cost of Credit Cards: Why It’s Time to Give Customers More Ways to Pay

For decades, credit cards have been the default non-cash payment option in Canada. They’re familiar. Convenient. Universally accepted. But for businesses, especially in today’s economy, that convenience often comes at a cost.

From rising fees and settlement delays to fraud risk and chargebacks, credit cards are no longer the no-brainer they once were. Meanwhile, consumers are demanding faster, easier, and more secure payment options. 

Let’s unpack why now is the time to diversify your payment options, and how your business can reduce costs and increase choice with flexible alternatives.

The Real Cost of Credit Card Payments

Credit cards are familiar and widely accepted, but for merchants, they can come with a hefty price tag.

1. Transaction fees typically range from 1.5% to 3.5% per sale, which adds up quickly for businesses with high transaction volume or tight margins. For example, a business processing $1 million annually in credit card payments could be paying upwards of $25,000 to $35,000 in fees alone—money that could otherwise go toward growth. According to a survey by the Canadian Federation of Independent Business (CFIB), 78% of business owners say that credit card processing fees are unaffordable for their business. 
2. Fraud and chargebacks are another major concern, especially in card-not-present transactions like e-commerce. Canadian businesses lose an estimated $530 million annually to credit card fraud, much of it from online sources. And chargebacks don’t just cost money. They take time, create friction, and leave merchants holding the bag for disputes they often can’t win.
3. Delayed settlement can also impede your company’s cash flow. Although your customer’s payment is processed in seconds, the actual movement of funds is far from instant. Credit card transactions typically pass through multiple parties—the cardholder’s bank, the card network (like Visa or Mastercard), and your acquiring bank—before finally reaching your account. This process can take anywhere from 1-3 business days, slowing down your access to cash.

All told, the traditional credit card model puts the burden on the company while offering fewer protections than many assume.

What Your Customers Actually Want

While credit cards still dominate many checkout flows, consumer expectations are changing. Today’s shoppers want speed, convenience, and control, and that includes how they pay.

Customers are increasingly looking for:

• Familiar payment methods they already trust, like Interac®
• Real-time confirmation so they know the payment went through
• More flexibility, especially outside of the credit system

In other words, offering credit cards alone may not cut it anymore. A growing number of consumers, especially younger demographics, are actively seeking alternatives that feel faster, more secure, and easier to manage. Merchants who offer more than one way to pay are removing friction at checkout, reducing cart abandonment, and building trust.

And while these trends reflect consumer demand, they also bring tangible cost benefits for merchants. Switching from credit card payments to real-time alternatives like e-Transfer or EFT can reduce transaction fees dramatically—unlocking thousands in potential monthly savings.

Lower Your Fees with Smarter Payment Methods

For example, if your business processes 5,000 transactions per month at 2.5% on $1 million in credit card payments, you’d be spending $25,000 per month in fees. Switch to EFT at $0.50 per transaction, and that number drops to just $2,500—a potential monthly savings of $22,500. 

Or, if you’re using the Interac® Request Money feature at $1 to 1.50 per transaction, your monthly cost would still be just $7,500—less than a third of typical credit card fees, while offering your customers a fast, secure, and familiar way to pay. It is also the only real time payments method in Canada! 

Beyond cost, these methods also come with fewer chargebacks, faster settlement timelines, and stronger fraud protection.

Why Choose When You Can Have Both?

Offering lower-cost alternatives doesn’t mean abandoning credit cards altogether. In fact, the most effective payment strategies are the ones that give your customers options.

With Digital Commerce Payments’ Acquiring Solution, you get the best of both worlds:

• The ability to accept all major credit cards for customers who prefer traditional methods
• The power to enable Interac® e-Transfer Request Money and other modern features, giving you a fast, secure, and cost-effective alternative
• A single, streamlined solution that supports multiple payment types, without the operational hassle

This kind of flexibility is especially valuable for companies serving diverse audiences or offering both in-person and online experiences. Whether you’re collecting rent, managing subscriptions, or processing high-volume sales, you can tailor your payment mix to suit your business without compromising the customer experience.

And because our platform is designed with Canadian companies in mind, you’ll always have local support, compliance alignment, and seamless integration to help you scale with confidence.

Interested in learning more? Explore our Acquiring Solution or book a demo today.