Payments Canada Launches Real-Time Rail System for Instant Money Transfers
Payments Canada has launched the Real-Time Rail (RTR) payment system, enabling instant money transfers between bank accounts 24/7. While initially available through a limited list of financial institutions including Wealthsimple and KOHO, major banks like RBC are expected to join by 2027.
Payments Canada announced on Monday the launch of the Real-Time Rail (RTR) payment system, enabling consumers and businesses to send and receive payments instantly. The new infrastructure clears and settles transactions within seconds, operating 24 hours a day, seven days a week.
Bank of Canada Governor Tiff Macklem described the launch as an important step in modernizing Canada’s payment infrastructure. With the introduction of RTR, Canada becomes the last of the G7 nations to implement a real-time rail payment system.
The system has been in development since 2021, built in collaboration with CGI, Deloitte Canada, IBM Canada, and Interac. According to estimates from the C.D. Howe Institute, Canada could realize up to $14.5 billion in cost savings due to lower processing costs and reduced float associated with the new network.
Initial participating financial institutions include Wealthsimple, Questbank, Peoples Trust Company, Paramount Commerce, KOHO, DoBusiness.com, Digital Commerce Bank, and Bank of America. Royal Bank of Canada is expected to introduce RTR in the second quarter of 2027. Wealthsimple clients will be among the first to experience instant money movement, though the company plans to roll out additional instant payment features in 2027.
The RTR system allows for the instant transfer of funds between different financial institutions. This capability enables employers to pay workers immediately upon completion of work, benefiting gig workers and freelancers. Landlords can receive rent in real time, and retailers gain immediate fund confirmation. The system is also expected to reduce the use of cash and cheques while decreasing the "float" time during which funds are temporarily unavailable. Additional security measures being implemented include fraud reporting tools, risk lists, and confirmation of payee.