Canada’s future in real-time
This article was originally published in The Central Bank Payments News on March 25, 2026.
By: Donna Kinoshita, Chief Payments Officer, Payments Canada
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.
Canada’s Real-Time Rail will provide opportunity with every transaction
For decades, the systems that facilitate the movement of money in Canada have operated safely, reliably and efficiently in the background, providing stability to Canada’s economy. However, at Payments Canada, our purpose extends beyond just the technical operation of clearing and settlement; we hold a unique position as a public-purpose, not-for-profit organization at the centre of the payment ecosystem with a responsibility to strengthen the prosperity, productivity and security for Canada through world-class payments.
We recognize that modern payment systems are as critical as highways or electrical grids. They are the essential engines for productivity as they move money, directly determining the speed of commerce, the security of funds and the overall efficiency of the economy.
Today, Canada’s payment ecosystem is more diverse, dynamic and evolving faster than ever before. Against a shifting geopolitical landscape, the modernization of our infrastructure is in strategic alignment with national priorities to build a stronger, more competitive Canada.
The centerpiece of this transformation is the forthcoming Real-Time Rail (RTR). The RTR is a transformational, made-in-Canada payments infrastructure designed to deliver significant benefits to consumers and businesses by driving innovation, improving efficiency and increasing choice. Payments Canada and our partners are modernizing Canada's economic foundation with real-time capabilities. This future payment infrastructure is designed to be a catalyst that will provide opportunities with every payment.
Navigating a shifting landscape
To understand the importance of the RTR, one must look at the current operating context of the Canadian payment landscape. Our Canadian Payment Methods and Trends (CPMT) Report, Payments Canada’s annual research that provides insights into how Canadian consumers and businesses pay, paints a picture of an ecosystem in transition. The latest figures show the total payment market in Canada experiencing steady growth, processing 22.5 billion transactions valued at $12.2 trillion.
While digital growth is evident, paper-based processes and legacy systems remain a component of the Canadian economy. For instance, despite a ten per cent year-over-year decline in transaction volume, cheques still accounted for $2.7 trillion in value in 2024, representing 22 per cent of total payment value. The friction of these legacy processes acts as a drag on productivity. While consumers may not pay a direct fee for writing a cheque, the cost of inefficiency is certainly embedded and felt in the financial system, resulting in higher monthly fees and reducing disposable capital for investment.
Furthermore, Canadians express a desire for faster, more modern alternatives in specific situations. Our research indicates that nearly half of all Canadians (49 per cent) find real-time payments appealing, and over a third (36 per cent) would likely switch from their current payment methods to real-time payments, primarily for the speed and convenience it offers. This data underscores a market demand: in a global marketplace where capital moves at the click of a mouse or push of a button, domestic delays in clearing and settlement represent costs that hamper productivity. Real-time capabilities need to become table stakes to any payment system provider.
Real-time productivity and economic prosperity
Payments Canada’s modernization strategy is directly focussed on the enhancement of Canada’s productivity. When small businesses wait for funds to settle, or when corporations struggle with manual reconciliation due to a lack of structured payment data, the entire economic chain those funds are supposed to enable slows down. The RTR is purpose-built specifically to eliminate these inefficiencies, treating payments as an economic enabler and opportunity rather than just an operational function.
The RTR will allow payments to be sent and received instantly and at any time. The uses of this capability are endless. For example, for the Canadian government, this could serve as an important tool for rapid disbursements, enabling the safe, instant distribution of emergency relief, tax refunds, or social benefits, which directly improves the financial resilience of citizens. For Canadian businesses, who have expressed a clear intent to improve efficiency and decrease expenses, the RTR could accelerate cash flow. By migrating volume away from legacy payment methods, funds can be used immediately, fundamentally improving business liquidity.
Speed, however, is only half of the story. The innovative opportunities of the RTR also lie in its adoption of ISO 20022, the global messaging standard for electronic data interchange. In legacy environments, payments often traveled with unstructured and minimal accompanying information, leading to manual work for businesses attempting to match payments with invoices. The ISO 20022 standard allows structured, or rich, data to travel alongside the payment. An electronic transfer could now carry an invoice number, tax information and detailed remittance advice in a standardized format. This capability paves the way for the end-to-end automation of account and payment cycles, drastically reducing administrative costs and human error for Canadian enterprises.
By adopting ISO 20022, Canada is moving in sync with the rest of the world’s financial systems. The CPMT report highlighted that a staggering 82 per cent of Canadians experienced challenges when sending money internationally, citing high transaction costs, hidden fees and long processing delays as major pain points. A modernized Canadian system that speaks the same language as the rest of the world makes it easier for domestic businesses to compete globally. The introduction of the RTR presents potential opportunities to connect with other interoperable real-time payment systems. This integration would facilitate seamless, transparent and lower-cost cross-border transactions with real-time and smarter settlement.
Fostering competition and innovation
Historically, the ability to clear and settle payments directly in Canada was restricted to a small number of financial institutions. While this model has served Canada well, the emergence of the fintech sector and the diversification of financial service providers has necessitated a new approach for the modern era of payments.
A critical component of our modernization vision is the broadening of access to Canada’s payment systems. Recent legislative amendments to the Canadian Payments Act (CP Act) and the Retail Payment Activities Act (RPAA), which came into force in 2025, represent an historic shift in how access to national payment infrastructure is governed. These changes expanded Payments Canada membership eligibility - and therefore potential access to payment systems — to include payment service providers (PSPs), credit union locals and designated clearing houses.
This expansion will foster competition. By allowing PSPs to become members and potentially access the RTR directly, upon meeting requirements, Payments Canada is leveling the playing field. We are enabling the growing payment ecosystem to expand, allowing entrants to provide new services, lower operational costs and reduce intermediaries. In fact, in the short time since the legislation has permitted it, we have already seen a number of new members welcomed to Payments Canada, with even more set to join soon.
The introduction of new participants into the ecosystem is not merely about increasing the number of players; it is ultimately about providing the opportunities for innovation and therefore more and better services for Canadians. When a wider variety of entities can access the same core infrastructure, competition shifts toward providing more value and better user experiences. This drives innovation in areas such as B2B and Me to Me payments, faster merchant settlement, cross-border transfers and specialized business tools.
In parallel to these shifts is the government’s advancement of consumer-driven banking (commonly referred to as open banking). Combining the transparency, safety and accessibility of consumer-driven banking with the RTR’s fast, data-rich and always-on infrastructure will further enable new opportunities for more players to build innovative, real-time financial products.
When consumers have the power to securely share their financial data and initiate payments through services of their choosing, the potential for personalized, efficient financial services becomes limitless and exciting.
Safety, soundness and a centralized defence
It is understood that as the global payment ecosystem becomes faster and more interconnected, the threat landscape becomes more daunting as well. Fraud and financial crime are no longer static risks but dynamic, sophisticated global threats. In an era of instant movement of money at increasing rates, the risks associated with fraud and organized schemes move just as quickly.
In our research, we found that 13 per cent of Canadians have experienced fraud over a six-month period, including unauthorized transactions and phishing. Alarmingly, the proportion of Canadians experiencing authorized push payment fraud is disproportionately higher among young adults aged 18 to 34, perhaps linked to their increased reliance on digital payment methods and heavy use of social media. Additionally alarming is that despite 89 per cent of Canadians acknowledging the increasing threat of financial fraud to individual and community prosperity, only seven per cent prioritize prevention.
Addressing this risk is a central focus for the Canadian payment ecosystem as a whole. A core alignment between Payments Canada and the regulatory community is the relentless focus on safety, soundness and the integrity of the financial system. Unlike legacy systems where fraud detection was largely siloed within individual financial institutions, our modernization journey places security at the center of the network.
Canada will be among the first jurisdictions to launch real-time payment infrastructure with centralized fraud capabilities built in from day one. This model leverages a network advantage against fraudsters, identifying suspicious patterns across the entire ecosystem that individual institutions might miss in isolation. Key capabilities include fraud scoring and real-time risk monitoring, functions that will continuously analyze transactions to detect and prevent fraudulent activities based on current and historical data. Additionally, confirmation of payee will act as a payment verification service, prompting the payor to confirm to whom they are sending money, directly combating misdirected payments before they are finalized.
By embedding these protections into modernized infrastructure, like the RTR, Payments Canada is placing protection at the centre of the future of payments and directly supporting the Bank of Canada’s mandate for systemic risk management and broader anti-money laundering (AML) priorities.
A secure and prosperous future
Based on global market research, Canadian payment ecosystem analysis and consumer market research, the truly transformative value of the RTR lies in what comes next. To fully realize the potential benefits for Canadian businesses and consumers, we are prioritizing a post-launch 'fast-follow' roadmap of essential enhancements to facilitate adoption of unique customer experiences, enable consumer-driven banking ‘write’ access, and global interoperability. We remain deeply engaged with our members, stakeholders, government and regulators to ensure the roadmap for the RTR meets the needs of all and delivers on its full promise.
The continued modernization of Canada’s payment system infrastructure is, ultimately, an investment in Canada's economic and sovereign future. It is a recognition that future prosperity depends on our ability to build infrastructure that is as ambitious as the people and businesses who will use it.
