Walmart Canada is eliminating the pickup fee from its online grocery service as it braces for increasing competition in a business where profit margins are already razor thin.

The retail giant said Tuesday it is cancelling its $2.97 charge for customers who order groceries online and pick them up in stores.

While the fee was modest, the company's internal studies indicated it was a barrier preventing some people from using their online grocery pickup service, said Daryl Porter, vice-president of online grocery for Walmart Canada.

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