Canada is finally getting faster bank transfers. Payments Canada’s new Real-Time Rail (RTR) payment system promises speedier payments and fund transfers — so fast, it could save Canada billions over the next decade.
Payments Canada announced RTR this week, noting the payment system is built around international standards, though you might not see the benefits right away. Financial institutions and payment providers are expected to come aboard over the next year.
The big change with RTR is a shift toward real-time payment processing. Currently, payments are usually handled in batches, meaning they can take a while to process. Under the new RTR system, payments can be handled within seconds, and it works 24/7, including holidays and weekends.
Faster payments, real benefits
Payments Canada positions this change as something with real, tangible benefits to Canadians and businesses. RTR could enable faster fund transfers between bank accounts, credit card payments, business-to-business payments, and more. It could also impact how businesses pay employees, particularly gig, freelance, and contract workers, by enabling businesses to pay as soon as work is completed.
Payments Canada even said that RTR could help those living paycheque to paycheque by helping remove the need to rely on high-interest payday loans.
On top of the increased processing speed, the RTR platform will include protections like fraud reporting, fraud transaction “safety” scores, and confirmation of payee tools.
A memo from the C.D. Howe Institute to Canadian financial institution customers estimates RTR could save between $5.3 and $14.5 billion over 10 years.
Some banks already support RTR
Canada partnered with companies like CGI, Deloitte Canada, IBM Canada, and Interac to develop RTR. Work started in 2021. However, Canada will be the last of the G7 nations to implement RTR.
So far, there are only a small number of financial institutions taking advantage of RTR:
- Wealthsimple
- Questbank
- Peoples Trust Company
- Paramount Commerce
- KOHO
- DoBusiness.com
- Digital Commerce Bank
- Bank of America
However, other Canadian banks are expected to join RTR as well. RBC, for example, is expected to adopt RTR in Q2 2027.
Header image credit: Payments Canada
Source: Payments Canada Via: Global News
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