Canada’s Real-Time Rail: what you need to know | The Paypers

In this editorial piece, Donna Kinoshita, Chief Payments Officer at Payments Canada, examines the steps being taken toward delivering Canada’s Real-Time Rail.

In today's rapidly shifting global landscape, modern, secure payments are essential to maintain and advance Canada’s global competitiveness. As the owner and operator of Canada’s national payment clearing and settlement systems, Payments Canada is focused on the evolution of these systems to deliver economic benefits and support national prosperity. Advancing modern payment infrastructure plays a critical role in enabling faster, safer, and more inclusive payments, thereby supporting economic resilience and long-term prosperity for all people who live in Canada. The RTR is a critical piece of this infrastructure and will support payments that are irrevocable, data-rich, and, most importantly, instant.

Canada currently benefits from real-time exchange and faster peer-to-peer payments through the Interac e-Transfer service. At launch, the RTR will have scale, ubiquity and interoperability as it will provide an uplift to Interac e-Transfer, which will use the RTR for the real-time clearing and settlement of its transactions. The RTR will enable real-time, irrevocable account-to-account payments 24/7/365 and will launch with centralised fraud mitigation services, making Canada one of the few countries to embed this level of security from day one.

Canadians are demanding faster payments more than ever before. Consumers expect modern, simple payment experiences, and our research shows that the majority of them are eager to embrace real-time payments when the Real-Time Rail (RTR) goes live, citing speed and convenience as key factors.

Businesses have also taken a keen interest in real-time payments and, in recent years, have dramatically shifted their payment preferences to opt for methods that enable faster transactions. In fact, nearly three in four small and medium-sized enterprises insist that payment innovations like the RTR are key to enhanced customer payment experiences and overall business growth.

To meet this growing demand for real-time payments, Payments Canada has been working in close collaboration and alignment with our members and stakeholders to deliver the RTR: a made-in-Canada system that will support instant, data-rich payments. By supporting enhanced efficiency, innovation, security, and choice, the RTR will bring a number of significant benefits to Canadians. For consumers, the RTR will provide faster, more convenient payments, greater financial control, and increased security. By providing the foundation for new payment products and services to be introduced by RTR member participants, the RTR will also provide consumers with greater access to more innovative payment options. For businesses, the RTR will improve cash flow management, reduce costs through more streamlined payment processes, increase efficiency, and enable businesses to enhance customer service.

Building this critical piece of infrastructure has represented a unified, industry-wide effort, and maintaining collaboration and alignment is integral to the RTR’s success. As such, Payments Canada has been leading engagement efforts to ensure the ecosystem is sufficiently informed, educated, and prepared to participate on the RTR, as eligible, once it’s live.

As part of these efforts, we recently concluded a highly attended public education series to support our public consultation on the RTR’s legal framework. Designed as an accessible pre-submission primer for the consultation, the series covered key topics including system access and participation, recourse and compliance, and fraud management. These sessions were attended over 2,000 times, live and on demand. Attendees represented a diverse cross-section of the industry, including financial institutions, payments service providers (PSPs), credit unions, regulators, industry associations, and financial services consultancies.

The ecosystem’s positive response to our consultation demonstrated the value of the industry’s continued engagement and diverse perspectives. The series also provided an opportunity to educate potential new member participants on the different types of RTR participation, highlighting the flexibility to participate based on an organisation’s needs and business objectives.

Recent amendments made to Payments Canada’s governing legislation, the Canadian Payments Act, have opened up Payments Canada membership and system participation to eligible PSPs, credit union locals and certain clearing houses, and are another important factor in industry participation on the RTR. These new system participants are poised to transform the payment ecosystem, fostering competition and safe innovation in payments. We're proactively reaching out to these groups to ensure they understand the steps to membership, the requirements for participation, the technical and operational requirements necessary to operate in a 24/7 environment, and the many benefits of the RTR. More participants on the system are beneficial for everyone, and I encourage those who are interested to connect with us by emailing info@payments.ca.

We continue to work with existing Payments Canada members who intend to participate on the RTR to prepare them for the system’s launch and the future opportunities it will present. Now that we have successfully moved into the RTR testing phase, Payments Canada’s member financial institutions, who have been integral to the RTR program from the start, remain actively engaged and highly focused.

As is true in any jurisdiction, widespread adoption of a new payment system takes time. By continuing to educate Canadians about the RTR’s benefits to consumers, businesses, and Canada’s economic well-being, the payment ecosystem can ensure they are prepared to embrace real-time payments with ease. Together with the ecosystem, we are paving the way for a robust and reliable system that will support national prosperity and strengthen Canada’s global competitiveness, empowering all Canadians well into the future.

About the author

As the Chief Payments Officer, Donna Kinoshita brings more than 20 years of stakeholder and strategic product development experience. Donna is responsible for managing Payments Canada's relationships with its members, stakeholders, and regulators, and Payments Canada's communications, policy, and research functions. As payments continue to rapidly evolve, Donna and her teams work closely with all industry stakeholders to ensure the Canadian payment ecosystem is inclusive, enables fair competition, and supports a thriving Canadian economy.

 

About Payments Canada

Payments Canada underpins the Canadian financial system and economy by owning and operating Canada’s payment clearing and settlement infrastructure, including associated systems, bylaws, rules, and standards. The Canadian economy depends on the exchange of billions of dollars each day. Payments Canada ensures that these financial transactions are carried out safely and securely. We are a public-purpose, non-profit organisation funded by our members, and we operate under a Board of Directors.