Unlocking innovation and growth: Why ETA supports broader access to Canada’s payment infrastructure
This summer, the House of Commons Standing Committee on Finance (FINA) invited stakeholders to submit what they would like to see included in the 2024 federal budget through a public consultation process. The submissions collected through this process highlighted the continued industry support — from players and interest groups across the payment ecosystem — for broader access to Canada’s payment infrastructure. One of those submissions was from the Electronic Transactions Association (ETA).
Scott Talbott is the SVP, Government Affairs at ETA. He shared his thoughts on the importance of broader access not only to ETA members, but also to those they serve: Consumers, merchants and the economy.
Can you tell us about the Electronic Transactions Association (ETA) and its role in the Canadian payment ecosystem?
ETA is the leading trade association for the payments industry. ETA represents the breadth of the payment industry, including independent sales organizations, payment networks, financial institutions, transaction processors, mobile payment products and services, payment technologies, equipment suppliers, and online business lenders. ETA’s member companies process over $1 trillion in payments in Canada each year. ETA members perform innovative work, developing and deploying innovative payment solutions and lending alternatives that are secure, fast, and convenient. ETA advocates on behalf of the Canadian payment industry to drive innovation in the Canadian market to benefit consumers and merchants.
The ETA’s recent submission to FINA's 2024 pre-budget consultation process highlighted the need for broader access to Canada’s national payment infrastructure. Why is broader access important for electronic payment service providers? How does it benefit Canadians?
Broader access to core payment infrastructures is important for several reasons. First, it will allow new payment companies to participate in the payment market, making it more competitive and innovative. Increased innovation generates new payment products and services that can make the payments more convenient for merchants and consumers. Increased competition helps reduce costs for merchants and consumers. Finally, increased competition yields new ideas and approaches to help the payment industry fight fraud. By contrast, if access is not increased, the benefits of new initiatives, such as the Real-Time Rail (RTR), will not be as widely enjoyed by all consumers and merchants. In turn, the Canadian payment ecosystem will not be as robust as it could be.
You spoke at The 2023 Payments Canada SUMMIT on the topic of broader access alongside Daniel Kornitzer, Fintech and Advisory Board Member, and Brigit Carrol, Manager, Policy and Campaigns from Wise. What is the one key takeaway you hope the audience got from that session?
That broader access and participation to new functions like the RTR can benefit Canadian consumers, merchants, and the economy. If granted access, new firms will increase the competitive nature of the Canadian payment system. Competition drives increased innovation for new payment products and services, lower prices, and increased innovation in fighting fraud. Increased access will allow all payment service providers to better serve consumers, merchants and the economy.
What are the biggest opportunities or challenges foreseen for electronic payment service providers in the coming years?
One of the biggest opportunities for electronic payment service providers in the coming years will be faster payments. With new functions like the RTR on the horizon, an increasing number of payment service providers will be able to move payments to recipients in an instant. There are also opportunities and challenges emerging from the rise of cryptocurrencies. Though it may be challenging to create the right regulatory framework to govern its development, collaboration between stakeholders and lawmakers presents an opportunity to create a positive policy environment for federally regulated institutions to interact with cryptocurrency, enabling the sector to safely flourish in Canada.