Interac Corp.’s e-Transfer service is now so essential that a breakdown of the payment system could wound the economy and unnerve companies and consumers, the Bank of Canada says.
The digital-transaction service has become such a key way of paying for things that the central bank’s governor, Tiff Macklem, decided to use his limited regulatory powers to designate Interac e‑Transfer a “prominent payment system” as of Monday, a notice published in the Canada Gazette said.
The new label means Interac’s e-Transfer system will now be regulated by the Bank of Canada, and highlights the importance of digital payments to both people and businesses, particularly during the coronavirus pandemic. The financial-services firm is owned by Canadian banks, credit unions, payment processors and other shareholders.
“Interac e‑Transfer has become central to the Canadian payments system,” the Bank of Canada said in a news release. “A disruption or failure of the Interac e‑Transfer system could cause a significant adverse effect on economic activity in Canada, potentially leading to a general loss of confidence in the overall Canadian payments system.”