Episode 47: The business case for overlays — building value on the Real-Time Rail

Elizabeth (Liz) Dempsey: 
Welcome back to The SUMMIT Summer Series, a special presentation by The PayPod, the podcast from Payments Canada that explores the trends and topics influencing payments in Canada and around the world.

I am your host, Liz Dempsey.

Before we get started, as you may have heard, registration for The 2027 SUMMIT is now open! We’ll be back at the Automotive Building in Toronto on May 4–6, 2027, and we are currently offering our lowest possible ticket price.

Listeners of The SUMMIT Summer Series get an even bigger reward with an additional $100 off your ticket by entering promo code SUM27PAYPOD when registering on thesummit.ca. Thank you for tuning in and for your continued engagement!

On this last episode of The SUMMIT Summer Series, we are looking at the business case for overlay services, a popular panel from the stages of The 2026 SUMMIT.

The launch of the Real-Time Rail (RTR) is on the horizon. We know how settlement and funding works. But the question remains, how will consumers or businesses initiate a payment transaction that rides on this new rail? What will the user experience layer look like? What is possible? The answer is overlay services! Today, we’re going to explore the commercialization of overlay services that will provide real-time paym ent capabilities to end users.

We join David Hooper, Vice-President, Banking & Payments, CGI, as he moderates our expert panel, featuring:

Michael Liberty, Vice-President, Global Money Operations at CIBC And Abraham Tachjian, Chief Regulatory Affairs Officer at Brim Financial

Enjoy the conversation.

Here’s David Hooper.

David Hooper:
Thank you very much for joining us. So my name is David Hooper, I lead payments consulting at CGI and also responsible for implementation of our CGI payment product at Scotiabank. And with me on the stage, I'll each take a minute to introduce yourselves. Yeah. Good afternoon everyone.

Michael Liberty:
So, Michael Liberty, I lead a team called Global Money Operations at CIBC that's actually traditionally known as a wire room. And a lot of the work that we do is actually the payment transformation. So I own effectively the enterprise payments. And most recently, I assumed the MAC role on behalf of Payments Canada and started about two weeks ago. Thanks.

Abraham Tachjian:
Hi everyone. I'm Abraham Tachjian. I lead regulatory affairs at Brim. We're a full stack payment company. From cards and everything else related to payments. We've recently joined Payments Canada as one of the latest members. So we're happy to be part of the organization. Prior to this role, I was the open banking lead for the Department of Finance, where I developed the open Banking framework. And in my past time, I count the days in which it will go live.

David Hooper:
There you go. So with open banking coming and the RTR being much closer, we thought this is the opportunity of that conversation. We won't talk about the technology too much. This is far more about how we add value. Because it's really just a utility or a payment rail. How do we add or create services on top of it that will add value to Canadians, both as consumers and businesses? So, you know, they're commonly referred to as overlays or competitive services. That's what we'll focus on. And it's everything from how and this is the perfect opportunity. We get both a bank industry perspective. Look at Abraham, of course, with your new role with your company. You know what we might call a fintech, but a financial service provider with a different lens, we can look at what are we going to do with this rail? How are we going to add value? What are we going to add?

Because it is about the services. It's not about the rail, the characteristics of the rail, be it real time, fast - those are the types of characteristics that you sell. So that's where we wanted to go with this conversation. Um, so I think we've briefly defined what an overly repetitive service is in a lot of countries. We've seen them, they've appeared, they've typically been mobile, mobile or online versions of it. A lot of them, of course, consumers want them for free, which might be fine for consumers, but we'll all make our money with corporates and commercial. So that kind of lays the groundwork for it.

So I started off with the first question we were talking about, you know, really from rail to the experience. Tell us your first thoughts on how do you see this evolving as it launches?

Michael Liberty:
Yeah, sure. I'll start. So really briefly, and I think you touched on it, and hopefully for those who had a chance to listen to some of the main stage, the theme of this conference is really the real time rail is going to launch. Um, open banking is also going to come, um, hopefully shortly thereafter. Um, and really what's important is the experience, right? So the foundation, the infrastructure, that's the safety and soundness. That's the thing that hopefully helps you feel comfortable as you use. But overlay is really going to be the client experience. Um, and that's, that's really where the innovation will come from whether it's new entrants, um, ISPs or fintechs or how the banks can actually evolve their existing products that they already serve to their clients. Um, and it's really going to be that client experience that's really going to help drive, um, again, what, what those use cases can be. Um, I'm excited personally to sort of see like, how do you actually move from, um, the traditional mobile because that's really what people think is just like, that's just table stakes. Actually what it can be.

Abraham Tachjian:
And Michael, I like how you make this distinction between the infrastructure itself and the service. I think as part of this messaging, look, for whatever reason, in Canada, we've been slow on policy development, infrastructure development. It is what it is. We're here now and we're making good progress. But we've spent so much time talking about these plans and how the infrastructure is going to be implemented that I hope as an industry, we don't lose sight of the distinction between the actual product that customers are seeing and the functionality behind it that is enabled, because if we simply rely on the infrastructure, this might kind of, you know, land like a thud, right? Consumers don't show up to a bank, say, hey, I'd like the RTR, please. They're looking for the services on top, right? So I think it's important. I think you guys both touched on it as an industry, we need to make a distinction between all the effort that's gone in to develop the infrastructure. Now that that's done, the work begins to actually layer on the services that will really highlight the functionality, highlighting the benefits of this. So I'm a little worried that, you know, we may get lost in the weeds in terms of what we've built and not take this fancy car out for a nice drive.

David Hooper:
You’re right. So if we break it down to the base elements, it's twenty four over seven. Well, yeah, mainly bankers in the room here. We live in a batch world. This is a bit different right. Let's be honest about that. Networks, they work during banking hours. So swift, you can't send a swift at two o'clock in the morning because you can't get into a branch at two o'clock in the morning, or at least as a consumer. So any service you've got, we can now make payments twenty four over seven. Yeah, we're going to have to work holidays and weekends. So operations teams. Hello. Right. That's a big change for everyone. So how do we start to present this to customers? The e-Transfer looks pretty good like that, but that's very consumer based for businesses. Where do you think this is going first?

Abraham Tachjian:
Well, I would say I don't think businesses need to be convinced on the value of this. I think when you look at behavior of specific demographics, I'm of the view that, you know, consumers discover payment features out of convenience, right? They essentially find out about a functionality that helps them. Whereas businesses, you know, the movement of money is core to their business. No pun intended. And so I think the businesses are actually dying for this type of product because you're finally consolidating a lot of the day to day functionality into one product that, you know, it's selling feature is the data rich functionality. So suddenly your billing, you're collecting and you're reconciling in one shot and you know, businesses know this. Consumers will look at it more from a convenience perspective, but businesses will look at how it can contribute to the operations of their business.

And so when you start looking at the number of these transactions that are conducted on a big scale, if you're looking at hundreds and thousands of transactions that organizations are relying on, the RTR with all the features that are built in and the three that I just mentioned. Suddenly there's a lot of headcount that you're looking at that could be deployed elsewhere. There's a lot of big deals that you could go chase, simply because a lot of the administrative functionality has been removed because of these innate features that we've built into it.

So I think if I'm looking at the potential of where this may go, I go back to what I was saying in the sense that, you know, consumers also want this, don'get me wrong, but they typically discover payment features out of convenience, whereas businesses actually look out for these things because they know that there's opportunities to improve the way they move money.

David Hooper:
Yeah. Now, I'll ask you, Michael, as we start to talk to businesses, I mean, they have their use cases, be it, you know, insurance or payouts, whatever. There's all of those use cases that we all know so well which ones will transfer to this payment type. Let's call it that.

Michael Liberty:
Yeah, I think just building off of like the data side, I think is going to drive a lot of those use cases. So any type of disbursement, like obviously the reconciliation behind that is going to be really, really important. I think a lot of the innovations are actually going to come through the businesses because they know their clients, they may know where their problems are. They may know where, what problems they want to solve. Like, um, the gig economy and the ability to do same day payments or emergency, like those types of things I think will be really, really important. And it'll be interesting to see if there are financial institutions that want to lead with that, or it could be other types of new players in the marketplace. And that may be how they differentiate themselves.

The consumer piece I think is really, really interesting as well. I don't like the term, but I'm going to use it because I couldn't come up with something else. But those moment of truth payments. Yeah. And someone said something, someone I think mentioned it yesterday, but the ability to go and make a down payment on your house without actually having to go get a draft.

David Hooper:
I could have used that two weeks ago.

Michael Liberty:
Exactly right. Like I've heard of stories and this is not a I'm not, this is not a CIBC story because like I'm in the community and you hear about like people that go in to get a draft written and said, can you just go across the street and ask them? Because they do it for free.

David Hooper:
Oh, free. Right? Yeah, exactly. I literally did that two weeks ago. I had to go into a BMO branch and get a draft from the branch, and they said, go across the street to TD. I had the information for the real estate company and I had to deposit the cheque. Someone said I wasn't supposed to be able to do that thirty thousand dollars draft in my hand to walk across the street or pay sixty five dollars for the wire. Yeah, I'll take forty five minutes to stand in line.

Michael Liberty:
But those are the types of things that you'll see, right? Like car purchases, those types of things like the ability to go and do something like that. I think you'll start to drive. One, I think from a convenience, like from a friction. Maybe not frictionless. There's still gonna be limits, and there's going to be other things that may be involved with that. But you will be reducing friction in traditional non-repetitive type payments. And I think that will help actually drive some other types of innovation as well.

David Hooper:
Let's dive a bit more on the experience side, because you've both touched on it. And that was the example. We look at the overall payment experience. Is it, I mean, it may not necessarily be from a payment perspective, be different from some of the other ways of moving money today. But that experience and I'll give you an example. We've talked to a couple of insurance companies and they went, “oh, I have no problem sending money. I send a file to my bank, they send the money to the client,” or “I have a PAD that's taking the premiums out of their account. Easy, efficient, low cost.” But the more they thought about it, they went, well, hang on. “If I can pay my brokers or dealer networks or, you know, you take a picture of your car accident and submit it and they indicate it and they can send you the money instantly.” It wasn't that you were solving a payment problem. It was the experience. And they went, “oh yeah,” all of a sudden now we look good and all those Yelp and Google reviews. Build on that. What do we see? Because the payment itself may not have a problem. Yeah, but it's that experience.

Abraham Tachjian:
I think we're touching back on the point where we started a conversation on in terms of the distinction between the functionality and the service itself, the value being in the service. The way I like to look at it is, look, if the payment angle out of it, is anybody going to remember your product, that's what is going to make an overlay, if you'd like, memorable. That's what's going to increase stickiness, what's going to really drive the consumer adoption. And one of the examples I typically refer to is this company in the US by the name of Trustly that has developed an account to account payment product for the gaming world right. Take the payment functionality out of it. Organizations are going to remember the service that Trustly was offering in terms of the fraud element built into this account to account payment functionality. The same thing for consumers. And that's where I see this distinction between what the RTR is providing in terms of functionality and what the service is really offering. And I think if you take just from an analytical perspective, if you take the payment functionality out and just look at the benefit you're getting as a merchant or as a consumer, and that's high, that's where you've got a sticky product, that's where you're really adding service to the overlay. Again, no pun intended.

David Hooper:
Exactly. You brought up a good point, the account to account. So a lot of the conversations we have, it's reminding people that account to account means I've got money in the account, right. And a lot of bankers, there are people on the issuing side, oh, it's going to attack our credit card business. Well, I pay with my credit card for one of two reasons. Or maybe both. A, I don't have the money and B I'm collecting some sort of points that I really want. So you've got to convince me to do it in another manner to do quote, the RTR transaction. But if I don't have the cash, I can't do it right?

So one of the ideas that we talked about a number of years ago was the idea of separating the funds from the source of funds from the rail. So with these experiences, I think there's an opportunity. I'll put this to you, Michael, for banks to say, okay, I'll pay whoever it is on that end. Now you and I have that conversation. Do you take it out of a checking or savings account or is it a line of credit? Do I float you a microloan? We'll deal with the payment debits, you and I, and that we've made the account to account transfer to whoever and they're out of the equation. Do you see this?

Michael Liberty:
These are the exact type of opportunities, right? That intraday or micro loans or those types of things. It's definitely a product offering that you could see. And this is something that would help enable that. And again, it could be for those regular that I need to go and, like something that I unexpected and I just need that, that one transaction for that one day, but it's immediate and it's that peace of mind and I don't have to worry about it again and again. That's one of the things that can be really, really important. Or it could be help managing like, as an organization, I know that David's going to get paid every Friday, but I know that he has to on this one invoice and I'm prepared to work with him on that because, because he called and we could maybe come up with some type of an arrangement with that. Right? And so you can absolutely work out what those different types of arrangements could be.

Abraham Tachjian:
And look, I think what I would add to this is like, let's not get overly optimistic of what this thing is going to do, right? Like it's not going to provide us payments, deliverance. It's got it's role for consumers. It's got its role for merchants, but maybe not every transaction has to happen in time, right? There's always going to be room for other type of payment products. I mean we've been having these discussions since technology was embedded in financial services with respect to what cards are going to do the cheques, what cheques are going to do, what ATMs are going to do to tellers. But lo and behold, customer needs evolve. And I find that if you look back at history, you'll always find a niche that a certain payment product may offer. So I think instead of looking at this, which sometimes we do as being the ubiquitous payment function, which ideally it becomes, but I think it also can coexist with other payment functionality that has a specific use case.

And like I said, not every business needs to move money instantaneously, and not every consumer really cares about it, particularly in the context that if you have a conversation with a person on the street and ask them to distinguish between e-Transfer and the RTR, if they answer, well, we'll hire that person. And number two, you shouldn't expect them to know. And there's a certain degree of familiarity with the product already in the market.

So I guess what I'm trying to say is, I think as an industry, we'll find a role for this payment feature. I think you have done a very good job of explaining what these could be, but let's not lose track of the fact that not everything may need to be in real time. And there's other payment methods that do the job.

Michael Liberty:
Yeah, yeah, the world doesn't run in real time, right? Yeah. Well fair enough. Yeah. It doesn't or otherwise people don't sleep.

David Hooper:
And as we talk about, we talk about real time all the time. I think for me, I always sort of drift back to it's the real-time settlement, right? Because if I email or e-Transfer the babysitter, the bank gives them credit for it. They've got the money, they're gone. The fact that her bank doesn't get it from my bank until tomorrow doesn't matter to either of us. But when you get into, particularly in the small business at SMB, SME world, the idea of actually making a payment and they've got the money before you're even out the door with the goods. That's huge for their cash flows, and it opens up a lot of possibilities for businesses and a whole bunch of additional services to add to them. Everything from, you know, as you said, cash flow forecasting to how do I help you, you know, smooth out the lumpiness of your cash flows.

Michael Liberty:
Especially with data, right?

David Hooper:
Even more so with invoicing and POS and reconciliations, right.

Michael Liberty:
So like the ISO, it's not worth the value of data in overlays is actually going to be a really important driver in any conversation, whether it's for helping detect fraud or if it's for developing new services or reporting or helping doing predictive analysis or even partnering with fintech in terms of like with open banking, like without good rich data, a lot of these overlays just, it'll just be, it'll feel the same, right? Of products that you're already used to, right?

Abraham Tachjian:
Yeah, absolutely. And look, I'm not an economist, but I'll pretend for a second here on this panel. But when we're talking about trying to improve productivity in this country and trying to grow, make big infrastructure bets, I think the RTR fits very well in that mold, in addition to all the services it is bringing. If I if I'm looking at it from an SME perspective, looking at my dad crunched numbers on a Sunday night and him losing his temper on, you know, the books and, you know, maybe he passed that on to me, because that's exactly my Sunday night situation, trying to balance my books. But I don't take this convenience that the data rich functionality brings to merchants very lightly. I really think that that's going to be a big point that is going to move the needle on how the RTR is successful. And I go back to my point around how consumers discover payment functionality out of convenience, whereas businesses really look out for these things. And I think there's a lot of value that's going to be extracted from saving time for these organizations.

David Hooper:
Yeah. You mentioned something earlier about, the convenience factor and payments being in the background. No one goes out to say, I'm going to go make a payment. You're going out to purchase some sort of service or a product and do that. And, you know, years ago we were talking about the Uberization of payments. Well, we all talk about it here. Uber does something really interesting with payments. It's a card on file in the background. So absolutely nothing innovative. But it's this very cool dispatching service where I don't have to think about the payment and we start to sort of verge into that realm. And I know you and I are giggling already. The idea with open banking coming in, the crossover between the Real-Time Rail will enable a whole bunch of open banking types of services that will make, you know, take out a lot of friction and add capabilities for small businesses and consumers.

I'm not even sure what to ask at this point because there's three different things there. But let's talk about the friction points that typically drive changes in payments because as you said it, we don't get rid of a lot of payment types. We keep adding new ones. Yeah. And as you said, there are certain niches where this works. Fine. Please don't touch it.

So let's sort of drift from friction in different sorts of segments and how we see maybe real time addressing those friction points that no other payment type has.

Abraham Tachjian:
I think this is one of the defining features that distinguishes our system from many other jurisdictions in the sense that there's this big focus on fraud, right? The fraud functionalities that are built into it as our country unfortunately becomes a bigger and bigger target for fraud. So I think that's one major defining feature that I think we can hang our hat on in the sense that, if I think I'm right, but I think we'll be the first country to go live with the RTR system with embedded fraud functionality in it.

So when I, when I'm talking about what are some of these benefits that fit into the conversation, you know, confirming the payee before you send out the amount of, authorized push payment fraud that Canadians are subject to, which kind of distracts from the benefits that these type of features can bring, that takes a certain demographic away from digital banking and digital functionalities. I think there's a huge opportunity there, and I think it really touches on your in terms of what's going to distinguish this consumer element of it.

Michael Liberty:
Friction actually works a couple of different ways. Friction will happen through adoption. I want to come back to that, but also friction actually, and I don't just mean consumers, but like the small business and this is where I was going to come back to adoption. Like, if you're running your business off an Excel sheet today on a Sunday, real time is not going to help you. Yeah. It's not like you really have to do something else.

So you really have to take that step to, to expose something, leverage the API capability through some tool or connect with some fintech that's actually going to give you that ability to leverage the data and actually move something and similar, like adoption, even even on a consumer, on a personal level. Like your point, I can send a need for today up to whatever, ten thousand dollars or whatever or whatever the number is at a personal level. And I don't really have to worry about it, right? Because the person I'm typically sending to is maybe because I'm putting a deposit on something like a piece of like some renovation I'm going to do at my house. Right?

And they haven't bought the material most likely yet anyways. So they have access to the funds hopefully before they go. And like they've just become used to that. Right? So that adoption friction is what has to change there, right? So that they know that they're going to line up jobs, they know that they're going to have the money, that they're going to be able to have, like source the materials in advance. And what does that actually do? Right? So it'll be interesting to see through adoption and how that adoption friction will start to change with this. Because again, back to if you don't worry about a real time payment today. Are you really going to worry about it tomorrow?

David Hooper:
Exactly. The whole conversation about fraud. I mean, lots of it going on here real time brings a couple of new elements to it from, from banks we've talked about, and there's been other sessions talking about how we've had to update our fraud systems to act even quicker. But you said, said the one and the one we've all watched for and seen in other countries was authorized push payment, a legitimate payment, but basically, instead of account takeover, where I come into your account and push it around, I've tricked you, hear all bells, account for your bills or you said the contractor, send it here. Here's the email address or the phone number to send it to. And you do it and it's gone and it's out the door. And you went, oh, you never got the money? Well, it's three banks away within 10s. Obviously we won't get too far into the solutions, but how do you see this changing? I mean, everyone says it's got massive, explosive growth in that type of fraud, but is it in scale with the other types of fraud that we have? I mean, should we be fearing this or is it under control?

Abraham Tachjian:
Most definitely. Absolutely. And look, I think it goes back to your friction question. I think the argument I would make, at least from my perspective, is fear is the friction. Every time I make a big payment, I'm always double checking. Triple checking. I'm terrified I'm going to make a mistake. Although this is the industry that I live in, this is the industry I spend the majority of my time on. It's still in the back of my mind, simply because of everything I'm reading and simply because of my negligence occasionally. But we'll talk about that some other time.

David Hooper:
That extra zero. Oops.

Abraham Tachjian:
Yeah. So I. I think it's a major driving factor of what will make this successful in terms of eliminating that point of the fear, eliminating that part of the friction, because it's becoming so sophisticated. And I'm happy to share a personal story. Look, we have a Saturday family lunches where people try to understand what it is I do for a living, and I'm trying to explain what's happening in the market and everything around fraud and all the warnings. And yet we still, as a family get hit. Our little SME got hit by authorized push payment fraud. Right? So that friction, I think with the RTR, to the extent that, you know, it's a surprising feature to advertise, but it really drives adoption, right? In the sense that I can tell you that the person you are paying is the actual person that deserves this payment. And I think removing that friction is going to go real far in terms of driving the success of this.

Michael Liberty:
Yeah. Back to the trust in the future, right?

David Hooper:
So yeah, so I mean, we've talked a number of times of we have to add just enough friction to slow it down. So I'm double checking. Yeah, here's the name or it was ten thousand and not one thousand. Yeah. That sort of thing. And for everyone obviously knows in the room this confirmation of payee that it will validate that I'm supposed to send money to Abraham. But that account you've just entered or the email address you've just given is belongs to Michael. Who are you sending money to? All right. Yeah, I want that friction. I want that capability to fix those. If it goes through smoothly. Well, you added another couple of steps and I'll grumble about that.

That leads to the question of we've now got the centralized fraud service. Every bank and every fintech and PSP will have their own fraud, fraud and AML combination of the two. Um, which you know, is a unique combination because in wires, it's all pretty much AML and in cards and other things, it's fraud monitoring and scoring. So we've got this combination going on. Is it okay that everyone's got different systems, different rules in that? Or will we need some sort of centralized standardization? How does the industry talk about it? Michael?

Michael Liberty:
Um, it's obviously we want to make sure that, any access to the infrastructure that there's that ability to again, increase some sort of friction. We don't want to have, um, the potential for someone to come in and actually expose, um, like the consumer base, right to some type of fraudulent type of transaction. Like obviously, um, like one of the defining priorities for the MAC [Member Advisory Committee] for the past couple of years prior to the go live is absolutely to make sure that we had that centralized fraud services. So everyone had the same ability to make sure how they use it would be a little bit more interesting, right? Because again, like you're going to receive that call back and you're going to be the one that actually has the decision point, like, how do you want to actually deal with that, that piece of information that you now have? And that's how you're going to work with your clients, right?

Abraham Tachjian:
I think you're speaking my language, data sharing ecosystems, right? Um, I think you make a very good point in terms of the success of this functionality being subject to a uniform implementation in the sense that everybody has to implement it in the same way. Otherwise, you've got gaps in terms of how fraud is evolving and the extent of the success will depend on financial institutions saying, hey, look, I've seen this. Keep an eye out on this and vice versa. I'm simplifying it, but we need to make sure that this functionality is embedded uniformly across organizations so that we have that active sharing of information to offset this nefarious action. Now we've had a mixed track record in Canada with respect to sharing information among certain participants. So hopefully, this is another angle, but to your point, I think it's really subject to a uniform implementation. You can't have a different version of this at different organizations. Otherwise you're not all reading from the same instruction manual.

David Hooper:
That's good. So we've touched on let's go back to the competitive forces again.

Abraham Tachjian:
Yeah, a positive spin. Let's go back to positive.

David Hooper:
That's good. We've touched on those realities and we've all got our eyes open going into this. Um let's start with maybe the easy one. What payment experiences does real time and the 24-7 capabilities, what does it address that we don't address well today whoever wants that one. Why don't you give it a shot.

Michael Liberty:
So there's um I purchasing a house maybe. Right. Like, like those deals typically close after a branch is closed. Right. So, if that's again, I'll be back to one of those, those very specific moment of truth like you've now you're in a competitive bid process, you've now secured the house and you want to make sure that you get your deposit in. That's an option, right? You're working with someone, you have the ability to get the money to, um, it's instant. Right? Um, you'll hopefully have the limit to be able to get that and that that will likely solve. Right. And again, there'll be a whole bunch of other clauses. I think that's a simple one. Insurance disbursements. I think that's a real easy one as well. Right. Um, again that person who has a fire at night or some other type of car accident, and those types of things can be dispersed instantly.

David Hooper:
Tough to do today with what we have to do today.

Michael Liberty:
So I think that those are some very simple ones that potentially some players may want to explore. I'm not the right person to ask from a banking perspective because I don't run product.

David Hooper:
Well, maybe more from a MAC [Member Advisory Council] perspective.

Michael Liberty:
But you know, those are the types of ones that we talk about from that type of perspective, is this ability where you can actually resolve a problem at that time.

Abraham Tachjian:
Look, I'll continue to hang my hat on the SME functionalities. And in fact, I'll go layer below looking at really, really small organizations like gig economy workers, if you'd like payouts or any functionality that allows them to get paid faster. I think there's a lot of opportunity there. In addition to what I've said so far, from an SME perspective, I really think there's so much potential there. That's where I would focus on.

David Hooper:
Let's tell a little story then and we'll see where it takes us. If we look at the launch of real time payments in other countries. Australia is a great example. I mean, the first competitive service was for consumers. We have E-transfer here and we've had it for many years. We all know it's ubiquitous. It's going to be pretty tough for anyone to compete with that for a consumer level. Australia eventually came around and they got into ID services, and then you started to see businesses or services directed at businesses.

We're probably a little light here on the business side in terms of what we have today, right? So if E-transfers the first overlay on top of top of the rail, the RTR, where do you see those corporate or consumer or sorry, not consumer, corporate, commercial or SMB, SME services that are directed at businesses. Is there a segment that jumps out? I mean, we've talked about the sort of use cases, but the segments that we think there's an opportunity for a new service. Is there anything like that? Because I haven't thought of it. I can see a lot of incremental build.

Michael Liberty:
Other than the data side. Like, again, I think it's all going to be driven off of. And again, back to, I think I indicated it earlier. They also have to make a change, right? So if they have access now to rich data, what do they actually do with it?

David Hooper:
And that's not new to the RTR. We just had the same conversation about wires.

Michael Liberty:
Correct. Right.

David Hooper:
Or ISO in general.

Michael Liberty:
Correct. Yeah. So the adoption of data and actually good data and useful data that's going to take time, right?

Abraham Tachjian:
Yeah. It's hard to say what the killer use case, at least for this country, will be. I think one of the challenges we may have in terms of reaching that threshold is overcoming some of the embedded, at least from a consumer perspective, behaviors just like you were mentioning, David, and I'm on your side here when I'm using a credit card because of points, right? I'm a huge points guy. I like to say I'm the worst client for a bank because I'll find ways to use those.

David Hooper:
Uh oh, you actually use them? You know, I just collect them. You know, I've never redeemed.

Abraham Tachjian:
I most definitely do. I'm thankful for the points guy website. But anywaysI think we need to, we need to come to terms with what I was saying earlier in the sense that this isn't going to be the only ubiquitous payment functionality. It will always live in parallel to other features. And so it's hard to say, at least at this point when we have this embedded behavior with consumers, where a certain degree, it's the default payment function, at least for some people. I mean, it is for me when I show up, to make a purchase, I'm thinking about, you know, which one of my cards is going to give me the maximum amount of points. So I think it's going to depend on finding functionality that lives in parallel to this, as opposed to taking an effort to surpass it.

Because as I said earlier, we've had a variety of technologies that continuously are layered on to financial services. And every time we're under this conception that it's completely going to destroy everything that existed beforehand, which never really happens. I mean, checks are still around, just like we mentioned it.

So it's hard to say. But I think if I'm looking at the elements that will address it, at least from a consumer side, it's, you know, the point at which it's convenient for consumers and the point at which you're deriving more value from perhaps the rewards point systems that Canadians are crazy for, let's admit it. So it's difficult to say, but I think those are the variables I would look at to be able to look at the KPIs, if you'd like, for a successful product on this.

David Hooper:
Yeah. Well, two of the functionalities that we've seen with most rails that we'll bring up because we have to have to talk about it. One I think is very much becomes consumer centric, and that's the way they'll think about it. They think this is the killer app. It's not: the QR codes. And we've all seen those you know, those complete system apps to WeChat and Alipay of the world QR driven. Being able to do that rather than having to log in and, you know, here's your phone number and we've sent it that way. Let's start with that one and then we'll come to the other one. QR codes would be very visible, probably a lot of change if you're trying to pay for your groceries with a QR code at Loblaws, you know, there's some changes to get us there, but it's in the realm of possibility.

Michael Liberty:
So I think QR codes is an interesting one, but Canada from an adoption from a digital standpoint and just like the chip and pin and the ability, like that's the QR killer, I think at least in Canada. You're absolutely right. Like UPI or Pix or like ones where you had, like, just like, let alone population and geographic challenges that you had to work through, but just that ability from a mobile perspective to actually transact on an, maybe an underbanked, I don’t want to say an unbanked, but an underbanked type population, like obviously, right. We think you can use your watch, you can use your phone. Up to two hundred and fifty dollars. Friction to me over two hundred and fifty that I have to use my card I'm actually okay with because I lose my phone sometimes. Yeah, right. Never mind the cards that are not in my wallet. Right. Or that right. So like QR codes, I think it is an interesting one. Like the adoption of E, you touched on that earlier. Like everyone knows how to use e-transfer today. Yeah. Right. It's actually very easy. And to put a phone number in like people are not going to lose sleep over that. So I think that's actually not a disadvantage, but it'll be something that from a consumer standpoint, like, again, people already have the ability to send money in near real time and they don't think about the settlement side of things. Yeah. It really is going to be the use cases where that doesn't work.

Abraham Tachjian:
And look on the QR codes are an example of most money movement services we have here in Canada in the sense that they're functioning on existing rails. They may not be the fastest or most efficient, but they're there. So we've had this experience here, and it's never really taken off at the scale that you've seen in other countries. And I go back to what I was saying in terms of consumer behavior, it's very hard to move a Canadians first, you know, first move to their points card, right? And just think about the friction you're creating as opposed to tapping versus going into your phone, scanning that picture and blah, blah, blah, blah.

It's surprising that something that is meant to remove friction could create friction, as opposed to something that's more ubiquitous with Canadians today.

Michael Liberty:
Code fraud is a thing.

David Hooper:
Well, I've done it. I've done it in demonstrations. I've taken pictures of my wife's Starbucks app and gone and paid for coffee. And she's like, what do you mean? Well, I have a picture of your QR code. It's not dynamic. Absolutely. Copyable. So those of you want free coffee from your spouse, there you go. But you're right. So, I mean, it was worth bringing up to talk about QR codes. It might be easy to pay the plumber with a QR code. But if I got his phone number now, not that much longer. And if you're pulling out your card at the at the your phone, at the at the cashier, it's easy to pay with that. So there may be specific situations where that works. I guarantee we'll have QR code type services built. I just don't know how popular they'll be necessarily.

Abraham Tachjian:
Yeah, yeah. We've seen it like there's been attempts to sell it in Canada. And every now and then I still see relics of this. It's just personally, I don't see the appeal and I don't think Canadians have seen the appeal. So I don't think that's going to be like, what's going to really drive our usage.

David Hooper:
So let me look at the other one that I'm hot on, I think is absolutely is request-for-payment request-to-pay. So you probably know better than I do how popular or within Interac with e-Transfer having that request money feature, but every other market in the world, that's where we've seen it. It's everything from bill payments to, you know, the babysitter going, hey, you haven't paid me yet, send me the money. Talk to us about requests-for-payment and how you see that evolving or launching.

Abraham Tachjian:
I think it falls into the suite of the SME products that I keep bringing up, right? It's another tool to facilitate, um, getting paid for a product. And you layer in all the other services. It just fits into the portfolio of all the benefits that an SME will get from this type of infrastructure. So I think it's just one part of the equation. Um, in terms of this portfolio, I don't think other than that, like I'm clearly showing my bias in terms of where I think this is going to go from a moving the needle perspective, but it just adds to all the benefits that SMEs are going to get out of this.

Michael Liberty:
I think RTP is a huge one for sure. And I think it's another one that you'll see innovation from a product perspective, because again, with the right data and the banks actually seeing the patterns, they'll actually be able to drive products off of things like that. Right? So it could be that you're, the babysitter wanted money or in my instance, like the dog walker got a text. There you go. Right. Forgot to pay on Monday and it was really good. I was at the conference this week. And I would have sent it instantly. Yeah. If she sent me a note instead of left a sticky note.

David Hooper: Or your buddy that runs, runs the wine club. I just sent you a case. You got to pay.

Michael Liberty:
Yeah. So I think you'll really see some interesting services that are especially driven with the consumer driven banking side. Like once you can actually get applications in different services that talk to each other or something like that. Yeah. It'd be pretty cool.

David Hooper:
So is it fair to say there'll be as it evolves, there'll be a balance between consumer convenience and solving business payment issues.

Abraham Tachjian:
Yeah, absolutely. The discovery of the functionality as opposed to actively looking for it. I think consumers come to our type of benefits not by happenstance, but just, you know, out of convenience. Whereas businesses, they know the existing payment infrastructure is challenging for them and they actively look out for it.

David Hooper:
Based on where we're looking at at the launch, let's give ourselves a year down the road. We've got e-Transfer. We've got some other new services that have appeared. What do you think the you know, I won't say killer app because you already got one, but what's going to take off? Is it purely convenience or is it problem solving? And I know that sounds like the last question.

Abraham Tachjian:
No, I'll allow me to answer it from a different angle. My concern here is that after many, many years of talking about this and finally delivering it, that it lands on a bit of a thud. Right? And the same applies to open banking as well. It's the same thing. It's typical Canada we talk about for so long. We build it up. There's anticipation and when it comes. My concern is, is this it? So I don't think that's going to be the case. Don't get me wrong. I think we've talked about it for the last hour in terms of all the benefits that this thing can bring. So my concern is more from that perspective. But I also do have confidence just from the historical development of the implementation of technology in financial services that eventually will find use cases for it. And there's sufficient precedent in other countries. It's not rocket science that we're implementing here that certain things will be able to be imported here. What those are on the first days, it's difficult to say. But if I were to take a bet, I shouldn't come as a surprise. Probably SME products.

Michael Liberty:
Yeah. I think adoption is going to be your biggest challenge, like twelve months from now. Like we'll just be finishing a lot of the conversion. Yeah. Right. So like, I think that's going to be one of the larger things that we have to sort of think about, like as the different participants come on, they may have an advantage to get slightly ahead, but if not everyone's on the service, like really what it is, right. So I think one of the things that we have to focus on is the right adoption and making sure people are, like all the things that we've invested time and a significant amount of money in and getting it right. Right. So back to the reason like this: this can't fail. And I don't mean fail from a project perspective, I mean like from a trust, right? Like, like if people aren't going to be comfortable using it, then there's no overlays. So it has to be implemented and it will be implemented right. Seamlessly. And I get that right. But now we have then we have to get the people converted over to it. Yeah. Right. And they have to trust it before they start to use other services. Yeah.

Abraham Tachjian:
We'll need an advertising campaign. I just don't know how it'll look for something like this.

David Hooper:
Well, everyone's been hearing the RTR, the RTR, the RTR, and those of us in the room that are, you know, the payment geeks inside the system, inside the bubble, it all looks great, but outside, they read it and go, so what? What is it? So again, this was the whole conversation about the services. They will only see services that will suit a need. How are you helping me pay for whatever reason or get paid for whatever in a quick way. That's something I can trust that I'll use. Because you're right. As with all payments, it's based on trust. The fact that it is primarily it is, you know, obviously all the banks are involved, the credit union world is involved. And we've got quite a number of financial services, let's call it fintechs. I hate doing that to you. Sorry. But you know, with the PSP qualifications and your Payments Canada membership, you're in the club. So you're in the tent now? Absolutely. Yeah. These are the companies that are going to create the services that we will all use or SMBs.

Abraham Tachjian:
Absolutely. I mean, let me be entirely clear. Our membership into Payments Canada is a validation of the potential we see in a product like this, both for us in our enterprise as well as the clients we serve institutionally or individually. So I think there's a tremendous amount of potential that'll come out of this. I don't know how we will advertise it as an industry, but maybe we don't have to. Maybe it'll be good enough that it'll be discoverable. There is definitely a need there. I'm not so much worried about that, but organizations like us and the new Payments Canada members, we see a validity in this product, and I don't think there'll be a fear in terms of all this time and effort spent for no reason.

David Hooper:
Yeah. So obviously looking at this for this conversation, we were thinking, well, what would the three of us say that, you know, earth shattering and blow your mind and all of that? Well, the reality is we do payments fairly well in this country and we've got things that look real time. And now we've got this other opportunity for presenting these services. But none of us can predict what's going to drive volume. What's going to be the killer app. Don't know. It'll be experimentation. It'll be adding things out there and you'll say, well, we don't want five ways of paying for the same thing. You can go at it. I mean, if you've got Amazon money or Google money, you'll try and go head to head with e-Transfer and good luck. You're going to have to spend a lot of money to do it because we all know the name, the brand, we trust it, all of those things. The next step is where do I find niches where there's unmet needs or problems? And we'll start to see people create new payment services that do that. And then we'll see what happens with drive. And that doesn't mean the RTR is a failure in any way because it hasn't shifted payments from other ones. And that was a big concern. So maybe let's touch on that. A lot of people think, oh, it's going to shift away from credit cards. It's going to shift there. Are there new transactions or is it a shift or is it a mix?

Michael Liberty:
I think cross-border will be an interesting use case. Yeah, right. We didn't talk about that earlier. I think the cross-border aspect of this will be interesting, especially for the lower value type payments. Like sending a wire is expensive, right. And like, I happen to run a wire room and we process forty thousand of them a day and the people send wires for nine dollars. I cannot figure that out. Or the one who they intended to send two hundred and they sent two million. Yeah. Right. So, so maybe some of those types of things, right? Like, do you actually need to send a wire. And I'm like, wires are always, they're always going to have a place. They're large values that is not a large value transaction, right?

Like please use the other types of opportunities. But because of how it worked today and the data like southbound ACH was not really a thing like it happened, but it wasn't widely used. So I think there's a really good use case there, especially from a North American standpoint. You will absolutely, I think, see interoperability across real time schemes. Eventually.

David Hooper:
ISO helps us with that.

Michael Liberty:
One hundred percent, right? So not just north and south, like I get excited about things like that. And you can leverage some of the infrastructure that's already in place, whether it's Swift or the card networks or whatever. Like there will be absolute ways that you can sort of leverage other existing rails with this as a capability, as an initiation point. You may get some other things from that.

David Hooper:
Yeah. Well, we certainly are expecting, you know, something comes in as a wire and we'll shift it for the last mile using the RTR. But as you said, and I'm very curious to see, there's at least a half a dozen experiments in this. How do we get interoperability between real time systems? So something that's a real time payment from Canada runs into a real time rail in the US, bounces into Brazil, or we have good models.

Michael Liberty:
We have you have UK and you have Sepa, right? So you have real you have interoperable um Thailand and Singapore. Right. There are some really good use cases that they started with something new, which is kind of what we have. Right.

Abraham Tachjian:
I think it also kind of makes it easy for us from a psychological perspective to say, look, this can be done. We're not the first ones doing it. Like we can drive full in without worrying about the delivery risk. The other point I want to raise is these, these people making mistaken two million dollar wires, who are they? Send them my number.

Michael Liberty:
It's people using technology and they're not validating. I can assure you.

Abraham Tachjian:
I think as we look at where, um, a real time transaction fits in, I think it's important to also contextualize all the other new payment functionality that is coming on board that is being regulated. I'm specifically talking about stablecoins. My mind goes to more where how is this going to fit into a stablecoin framework that a Bank of Canada is developing and how it could contribute to that transaction? Perhaps, you know, the check off point or the onboarding point in terms of moving funds in and out of stablecoin purchases, I think that may be one of the unique perspectives from our jurisdictions that others had not looked at.

David Hooper:
Yeah, exactly. All right. Thank you very much, everyone. That's it. Unfortunately, we're out of time.

Elizabeth (Liz) Dempsey:
That’s a wrap on The SUMMIT Summer Series. We want to extend our sincere thanks to our panelists, Michael Liberty and Abraham Tachjian and to our outstanding moderator, David Hooper. Ultimately, as their discussion reflects, infrastructure isn’t an end in and of itself. It’s about what that infrastructure will enable: innovative products and services. And their success depends on building trust.

Thank you so much for tuning in with us this summer for highlights from the stages of The 2026 SUMMIT and a preview for what’s to come in 2027.

If you enjoyed this episode, please subscribe to The PayPod on your favourite podcast app. There have been so many valuable conversations throughout this series, so please be sure to go back into the archives!

And finally, don’t forget to take advantage of our lowest possible ticket price for The 2027 SUMMIT, available to listeners of The PayPod using promo code SUM27PAYPOD when registering on thesummit.ca

I am your host, Liz Dempsey. Thank you for listening to The PayPod.