Walmart Canada stores will stop accepting Visa cards because the credit card provider charges merchants "unacceptably high" fees, according to the retailer.

Walmart had been unable to agree with Visa on an "acceptable fee" and would stop accepting the firm’s credit cards from July 18, it said on Saturday.

The company added it still hoped to reach an agreement with Visa.

The decision would not affect the US stores of parent Wal-Mart Stores.

"Walmart made this business decision despite Visa offering one of the lowest rates available to any merchant in the country," a Visa spokeswoman said.

"We are disappointed that Walmart chose to put their own financial interests ahead of their own consumers’ choice."

Representatives of Walmart Canada and Visa declined to respond to questions on specifics of payment terms.

A Walmart Canada spokesman said the retailer paid more than C$100m ($78m) in credit card fees every year, but specific transaction fees were part of "confidential agreements".

Canadian retailers have long complained about what they call the high interchange fees they pay credit card companies.

In 2014 Visa and MasterCard said they would trim Canadian transaction rates to an average effective rate of 1.5% after complaints about their fees almost resulted in government intervention. Unlike American Express, which typically negotiates a flat fee with every merchant, Visa and MasterCard have variable fees based on the status of their different cards.

Small retailers, which usually have less power to negotiate transaction terms, have said this hurts them as they were never sure of the rate between 1% and 3% they would be billed on any given transaction.

Walmart Canada said stores in the northwestern part of the Ontario would be the first to stop accepting Visa cards, and the change will then be rolled out in phases.

Reuters