The Hidden Truth: Most Canadian businesses unknowingly overpay on card processing by 80% or more—not because of high interchange rates, but because of opaque markup structures designed to obscure the true cost. If you’re processing over $50K/month, you’re likely leaving $15,000+ on the table annually.

The Card Mix Conspiracy

According to Visa and Mastercard’s official interchange tables, Canadian businesses face a unique challenge: 68% of consumer cards are VINF (Visa Infinite/Mastercard World Elite) cards with premium rewards structures. These cards carry interchange rates 80-100% higher than base consumer cards.

The Math Nobody Shows You

Here’s what a $100,000/month processing volume looks like:

1.65% Optimized Base Rate $19.8K Annual
2.95% Unoptimized Reality $35.4K Annual
$15.6K Annual Overpayment Per $100K/mo
80% Markup Hidden Before Fees

Why This Happens

Most Canadian businesses are on one of three predatory pricing structures:

Flat Rate Processing

2.9% + $0.30 PER TRANSACTION
  • Square, Stripe, and similar providers charge a flat rate regardless of actual interchange cost
  • Positioned as "simple" and "transparent" but most expensive for significant volume
  • No optimization possible—you pay premium rates even on low-cost debit transactions

Bundled "Interchange Plus"

QUOTED AS IC+ 0.50%, REALITY: IC+ 1.5%
  • Processors quote "Interchange + 0.50%" but hide additional fees
  • Card brand fees (0.15-0.30%), authorization fees ($0.10-$0.15/txn), monthly minimums
  • PCI non-compliance fees, batch fees, statement fees
  • Your "0.50%" markup quickly becomes 1.2-1.5% in total hidden costs

Tiered Pricing (The Worst)

60-80% OF VOLUME AT "NON-QUALIFIED" RATES
  • Three rate tiers: Qualified, Mid-Qualified, Non-Qualified
  • Subjective rules determine which tier applies to each transaction
  • Most businesses discover 60-80% of volume is "Non-Qualified" at inflated rates
  • Completely opaque—impossible to audit or optimize

The Canadian Context

Unlike U.S. businesses where debit cards are common, Canadian consumers overwhelmingly use premium credit cards:

  • VINF cards: 68% of consumer transactions
  • Commercial cards: Growing rapidly (15%+ in B2B)
  • Debit cards: Only 22% of card volume

This means Canadian businesses face higher baseline costs—which makes processor markup even more damaging.

What Telos One Does Differently

We operate as vendor-agnostic consultants with fiduciary duty, not sales agents. Our approach:

1. Multi-Acquirer Access

We maintain relationships with 10+ processors across Canada and the US. This enables true competitive negotiation rather than pushing a single vendor.

2. Transparent Auditing

Free 15-minute payment audit analyzing:

  • Current effective rate vs. optimal rate
  • Hidden fees breakdown
  • Savings projection

3. Implementation Support

Once you choose a processor (your choice, not ours), we handle:

  • Equipment setup
  • Integration with existing systems (PSA, accounting, CRM)
  • Training
  • Ongoing optimization

Case Study: Toronto-Based MSP

Challenge: Paying 2.85% effective rate on $180K monthly processing
Solution: Multi-acquirer RFP, moved to interchange-plus with proper optimization
Result: 1.78% effective rate, saving $1,926 monthly ($23,112 annually)

Time to implementation: 14 days
ROI on consulting fee: Recovered in first month

The Telos One Difference

We’re former industry insiders who got tired of predatory practices. We succeed when you save money—not when we upsell you unnecessary equipment or services.

Our business model is fundamentally different:

  • No recurring commissions from processors
  • No vendor lock-in
  • Transparent flat-fee or percentage-of-savings compensation
  • You own the merchant account relationship

Next Steps

If you’re processing $50K+/month in card volume, you’re likely overpaying. Our free audit takes 15 minutes and provides:

  1. Current effective rate breakdown
  2. Comparison to optimized rate
  3. Projected annual savings
  4. No-obligation recommendation

Stop Overpaying on Payment Processing

Get a free 15-minute audit from former industry insiders. No sales pitch, just transparent analysis of your current costs vs. optimized rates.

Request Free Audit Schedule Consultation

Hatim Dhanani is Principal at Telos One, a vendor-agnostic technology consultancy specializing in payment processing optimization, cybersecurity, and digital infrastructure for North American businesses.