Interac Corp., with the support of 13 leading Canadian financial institutions, is launching Interac e-Transfer for Business. The solution enables real-time digital payments to personal and commercial bank accounts with confirmation of funds received within seconds.
With more than eight in 10 (83 per cent) business leaders calling for new commercial payment products as part of their post-pandemic digital transformation, according to recent research from Interac, this allows Canadian businesses to send and receive payments faster and more efficiently than ever before from the safety and security of their financial institution. Businesses are still reliant on cheques, with over 389 million commercial cheques in market in 2019 representing an average value of $9,000 each. With higher limits of up to $25,000, Interac e-Transfer for Business transactions have the potential to displace upwards of 200 million of these cheques.
“The launch of Interac e-Transfer for Business in collaboration with Canada’s banking and credit union community marks a milestone in the modernization of Canadian payments and provides a timely solution as businesses embrace financial transformation to aid their recovery and growth plans,” said William Keliehor, Chief Commercial Officer at Interac. “It reflects an increasing focus from Interac on the commercial market as we respond to the accelerating need for secure, data-rich, real-time business payments, made especially evident during the pandemic.”
Despite the challenges of COVID-19, the Interac commercial payments research shows that business respondents are optimistic about recovery with 8 in 10 (82 per cent) aspiring to grow over the next two years. Within this period, 83 per cent of finance professionals surveyed say applying digital transformation to their function is a priority. The majority (77 per cent) want their finance team to spend less time on transactional processes and more time on higher value-add functions.
“Interac e-Transfer for Business is a game changer for Scotiabank’s business clients” stated Dougal Middleton, Vice-President of Enterprise Payments at Scotiabank “They demand safer and easier ways to pay and get paid. Interac e-Transfer for Business meets that need and can dramatically streamline reconciliation processes and maximize working capital. It’s also an important first step in delivering modernized payment services for Canadian businesses.”
Interac e-Transfer for Business makes this possible by alleviating the need to follow up with suppliers as payment confirmation is provided within seconds, while also reducing time consuming manual reconciliation processes through data-rich payments. With higher transactional limits of up to $25,000 and flexible payment routing options, this solution gives commercial users more choice, a higher level of efficiency and control in managing receivables and cash flow. Users will also have the added flexibility of sending funds directly to account numbers they have on record, in addition to traditional Interac e-Transfer payment routing options of an email address or mobile number.
The applications of Interac e-Transfer for Business also span multiple industries and business sizes. A small business owner can use the solution to pay employees while spending less time on administration, a franchise can facilitate just-in-time vendor payments, while an insurance company can leverage it to distribute claims with funds received and available for use within seconds.
“Interac e-Transfer for Business is poised to do for business payments what Interac e-Transfer did for the personal cheque,” said Todd Roberts, Canadian Payments Leader at Deloitte Canada. “We expect businesses will respond favourably to this introduction as it accelerates their ability to fully participate in Canada’s post-COVID-19 economic recovery.”
Working with Interac, over 90 per cent of Canada’s financial institution market share is able to receive real-time, data-rich transactions. Leading Canadian financial institutions such as ATB Financial, BMO Financial Group, CIBC, Desjardins Group, HSBC Bank Canada, Manulife Bank of Canada, National Bank of Canada, Peoples Trust Company, Royal Bank of Canada, Scotiabank, TD Bank Group and Canada’s Credit unions including Meridian, First West and Vancity, are enabling this functionality for their customers. Depending on the customer segment, BMO Financial Group, CIBC, Peoples Trust Company, Royal Bank of Canada and Scotiabank are enabling the ability to initiate these transactions. Many more financial institutions are anticipated to enable these capabilities for their customers over the coming months.
“Business owners told us they want to spend less time on transactional processes and more time focused on the growth of their business, and Interac e-Transfer for Business was developed with this in mind,” said Anurag Kar, AVP, Money Movement, Interac Corp. “Bringing the market together to create a simplified way to pay or be paid, which boosts cash flow management and overall efficiency, will help the thousands of businesses participating in Canada’s economic recovery.”
The launch of this solution by Interac builds on a track record of delivering made-in-Canada innovation at scale over many decades. The company connects nearly 300 financial institutions and collaborates within the payments ecosystem to deliver transformative products that meet the evolving needs of Canadians.
As recently announced, Interac is working with Payments Canada as the exchange solution provider for the country’s new Real-Time Rail (RTR), a new real-time payments system. Once the RTR is live, Interac e-Transfer for Business payments will utilize the new RTR exchange for processing.
In August 2020, Interac e-Transfer was designated a prominent payment system under the Payment Clearing and Settlement Act. Interac e-Transfer for Business is the first significant change for the service following this designation.
Interac commissioned Phase 5 Consulting to conduct an online survey of 152 financial decision-makers in Canadian mid-sized businesses with 100-499 employees. Participants were recruited via an online research panel. Fieldwork was conducted in English and French in May 2021.