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How to Cancel Your Merchant Services Contract in Canada and the US – A Step By Step Guide

reviewing and signing a merchant services contract

Ivanca Urecheanu

Rescue Team

High payment processing fees can take a real toll on profitability for any business. While the costs may appear manageable individually, over time, they accumulate and become a significant drain on your bottom line. If you find yourself locked into a restrictive contract with high fees or subpar service, it’s time to reconsider your options.

It may seem easier to stick with your current processor, but continuing to pay inflated fees, dealing with poor customer service, or enduring unfavorable contract terms can ultimately hurt your business. The good news is that you may not have to stay locked in your contract. 

Evaluate Your Current Contract

Before taking action, it’s essential to thoroughly assess your existing agreement. Start by gathering all relevant documents, including the original contract, any amendments, and recent statements.

Look for key elements such as:

  • Contract duration and renewal terms
  • Processing fees and rate structures
  • Equipment lease agreements
  • Termination clauses and associated fees

Compare your actual monthly costs against the initially promised rates. Many businesses find significant discrepancies between expected and actual expenses.

Consider using tools like the Rescue Payments calculator to estimate potential savings with alternative providers. This can help quantify the benefits of switching and justify breaking your current contract.

The Difference Between Canadian and U.S. Contracts

Merchant contracts in Canada and the U.S. come with different protections for fee changes and cancellations. In Canada, the Code of Conduct for the Credit and Debit Card Industry allows merchants to cancel penalty-free if fees increase or new charges (like a new card) are introduced, typically within 90 days of notice. In the U.S., there’s no federal code of conduct, so cancellation depends on the termination clauses outlined in your contract.

Things to Watch:

  • Fee Increases & New Charges: Canadian merchants can cancel under the Code of Conduct, while U.S. businesses must rely on their contract terms.
  • Renegotiation as an Alternative: If penalty-free cancellation is not an option, you may still be able to negotiate better rates when fees change.
  • Auto-Renewal Traps: Many contracts automatically renew unless you cancel in time. This could lock you into another term with penalties for early termination. Watch for auto-renewal clauses and set reminders for cancellation deadlines.
  • Cooling-Off Period (Canada Only): Some provinces give you 4-10 days to cancel contracts signed in person or outside a business’s location, but this rarely applies to B2B merchant services. Always check your provincial rules and contract terms.

Real-World Example #1:Dental Clinic

Mohsin, the owner of a local dental clinic, was using a popular dental practice payment processor with a flat rate of 2.9% + $0.30 per transaction. It seemed simple at first, but with $50,000 in monthly credit card transactions, his fees quickly added up:

Monthly processing fees: ~$1,450
Annual cost: $17,400

After we spoke, Mohsin reviewed his contract and discovered an auto-renewal clause and a $500 early termination fee. When his provider increased monthly fees, he realized he could cancel without penalties.

By switching to Rescue Payments’ surcharge program, we helped Mohsin eliminate nearly all out-of-pocket processing fees while staying fully compliant. After factoring in minimal monthly costs, he saved over $15,000 per year—extra funds that went right back into growing his practice.

Real-World Example #2: Retail Store

“Switching to Rescue Payments cut our processing costs by 80%. It’s been a game-changer for our business.” – Sarah T., Retail Store Owner

Similarly, an accounting firm partnered with Rescue Payments and saw dramatic results. Not only did they reduce their annual processing fees by $50,000 after implementing our surcharge program, but they also integrated their payment processing with QuickBooks. This streamlined their accounting processes, reducing manual data entry errors and saving valuable time.

These success stories demonstrate the tangible benefits that businesses can achieve by breaking free from unfavourable contracts and adopting more suitable payment processing solutions.

Rescue Payments savings calculator - Find out how much you could save by switching payment processors. Click here for a free Rescue Review and personalized cost analysis.
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Checklist: How to Cancel Your Merchant Services Contract

  1. Review Your Contract: Examine your agreement for clauses on cancellation, notice periods, and penalties. Knowing your rights will help determine your options.
  2. Monitor Fee Changes: Stay alert for any notifications regarding fee increases or new charges. These changes may grant you the right to cancel without penalty.
  3. Reach Out to Your Provider: Contact your provider to inquire about the cancellation process and any penalties involved. Below are the customer service numbers for some popular providers:
    • Moneris: 1-866-319-7450 (U.S. & Canada)
    • TD Merchant Services: 1-888-782-4663 (U.S.), 1-800-263-9128 (Canada)
    • Square: 1-855-700-6000 (U.S. & Canada)
    • Stripe: 1-888-963-8955 (U.S. & Canada)
  4. Initiate the Cancellation Process: Once you’ve reviewed your contract and discussed the terms with your provider, formally initiate the cancellation. Ensure you receive written confirmation and retain all correspondence.

Example Call Script: What To Say When you Contact Your Provider to Cancel Due To A Recent Fee Change

Merchant: Hi, my name is [Your Name] from [Your Business Name]. I’m calling about our merchant services account with you.

Processor Representative: [Processor’s greeting/acknowledgment]

Merchant: I recently received notice about changes to our processing fees. According to our agreement this fee increase gives us the right to cancel our contract without penalty. I’d like to proceed with canceling our service.

Processor Representative: [Possible response requesting verification or explanation]

Merchant: I’ve reviewed our contract carefully. Under the terms and, specifically, in line with the Canadian Code of Conduct [or “our agreed-upon terms” if US], this fee change permits cancellation within a specified timeframe without any penalties.

Processor Representative: [May request additional information or offer incentives to stay]

Merchant: I appreciate your efforts, but the fee increase impacts our business significantly. We’ve decided to move to a different provider that better aligns with our current needs.

Please let me know what specific steps we need to take to finalize this cancellation. Additionally, please send written confirmation that our account will be closed without penalty, as per our agreement.

Processor Representative:[Confirmation of steps and closure details]

Merchant:Thank you very much for your help. Please confirm via email once our service has been officially terminated. Have a good day.

Things to Look for in Your Next Payment Processor

Making the switch to a new payment processor can offer numerous advantages. Here’s what to consider when choosing a new provider:

  • Transparent Pricing: Ensure no hidden fees, so you know exactly what you’re paying for. At Rescue Payments, we pride ourselves on offering transparent pricing with no surprise fees.
  • Dedicated Support: Great customer service is crucial. Ensure you have access to responsive, knowledgeable support whenever you need it.
  • Flexibility: Look for month-to-month agreements that give you more control and adaptability as your business evolves. Rescue Payments offers flexible terms tailored to your needs.
  • Seamless Integration: Choose a provider that integrates smoothly with your existing systems. If you’re using Xero or QuickBooks, Rescue offers direct integrations to simplify your setup and sync your payment processing effortlessly.

These factors will help you choose a provider that aligns with your business needs, ensuring a smooth transition and long-term value.

Is There a Cost to Staying?

Sticking with an overpriced processor might seem easier than switching, but in reality, every month you stay is costing you money. Just like Mohsin’s clinic, making the switch could mean thousands in annual savings that go back into your business. The question isn’t whether you can afford to switch – it’s whether you can afford not to.

I’m Ready to See What Else is Out There 

Breaking free from your current merchant services contract can seem overwhelming, but with the right roadmap, it’s an opportunity to save money and improve your payment processing. By understanding your rights, following these steps, and selecting a provider that meets your business needs, you can enjoy lower fees and better service.

Contact us today for a free payment audit to discover how much you could save. We’re committed to providing businesses across North America with tailored solutions that drive success.

Ready to reduce your fees and simplify your payments? Get in touch today.

Want advice on setting up a surcharge program?

We host weekly live trainings teaching you how to get the most out of your surcharge program, and if you want to get learning right now, you can download our Surcharge Canada Guide.

Download the Surcharge Canada Guide
Surcharge Canada Guide