In a unanimous vote on Wednesday, Mexico’s Chamber of Deputies passed an amendment to the Consumer Protection Law that prohibits commissions on purchases made with a credit card or debit card.

Lawmakers in the lower house of Congress voted 446-0 to approve the bill, which now moves to the Senate for consideration.

The legislation not only bans the application of commissions but also establishes penalties for any business that issues a charge against consumers that use a credit card or debit card.

A statement issued by the Chamber of Deputies following the vote stated that the government agency responsible for consumer protection in the financial sector, Condusef, has detected that some commercial establishments impose commissions or charges that range from 3% to 5% more than the total value of the purchase or service if payment is made via a credit or debit card.

This practice violates the agreement forged between businesses and financial institutions regarding point-of-sale terminals. The accord states that businesses should not transfer excessive fees to consumers. 

The bill heading to Mexico’s senate amends Article 7 of the Consumer Protection Law by inserting the following language:

“Those who provide goods, products or services are prohibited from charging commissions, fees, additional charges or the equivalent to consumers who use debit cards, credit cards or other protocols as a method of payment.”

“Other protocols” refers to checks, electronic transfers and preauthorized credit card charges.

Should the bill become law, fines of between 701 pesos (US $42) to 2.2 million pesos (US $136,000) could be applied to offenders.

National Action Party (PAN) Deputy René Figueroa Reyes told the newspaper Proceso that the reform is a step toward “eliminating the corrosive practice” that many businesses engage in to make customers believe it is more costly to pay electronically than with cash.

Consumers should be assured that they need not pay extra fees every time they use their credit cards, Figueroa said, adding that the reform will allow more equitable access to financial services and result in greater financial inclusion for the public at large.

With reports from El Economista, Proceso and Reforma