For years, fintechs have been pushing Payments Canada to pick up the pace on the long delayed Real-Time Rail instant payment system. With testing of the system slated to begin in the coming months, the organization focused on a new challenge at its annual Toronto conference: getting banks and fintechs ready to use it.

The background: Payments Canada, a non-profit organization that reports to the government, started laying the groundwork for the Real-Time Rail in 2015. The U.K., the U.S. and other countries around the world already have similar instant payment processing systems, which have been credited with lowering costs to consumers and increasing competition. Currently, fintechs have to go through a private service like Interac to process small payments for customers. The Real-Time Rail would also let users transfer money instantly and directly between bank accounts, instead of relying on paper cheques and bank drafts. 

As The Logic previously reported, Canada’s large banks—which could lose ground to competitors with new access to a national payment rail—currently comprise most of Payment Canada’s membership and have been blamed for slowing the project down. Bank executives with Payments Canada board seats pushed back on progress on the Real-Time Rail, although the organization denied it was unduly influenced. 

All systems go: In an interview, Donna Kinoshita, chief payments officer at Payments Canada, said a consensus has now formed on the need to forge ahead. “We were all aligned … there were no dissenters,” she said, adding that the project has now moved from “aspirational” to reality. Kinoshita said she expects the technical infrastructure behind the Real-Time Rail to be completed by July, with a year-long testing phase to follow before launching it in the real world.

Bank on it: Now that the Real-Time Rail is almost built, Payments Canada’s next task is rolling out widespread testing, and ultimately getting users onboarded. Kinoshita declined to say how many banks and fintechs have signed up, only that “the excitement is palpable.” Payments Canada wants to enable new use cases, not just steal market share from competing payment systems, Kinoshita said. For example, she said the organization is in talks with the Receiver General about using the Real-Time Rail to instantly distribute emergency relief payments after disasters such as wildfires.

Call to action: In opening remarks at the conference Tuesday morning, Interac CEO Jeremy Wilmot and Payments Canada CEO Susan Hawkins both said modernizing the payment system is a group effort. “The choices we make today will determine whether Canada merely keeps pace or whether we set a new global standard for payment competitiveness,” Hawkins said. Kinoshita said banks and fintechs have “got a ton of work to do on their ends” to get ready to connect to the Real-Time Rail.

No, really, we mean it: After a decade of promises that the Real-Time Rail is just around the corner, doubts still swirl around Payments Canada’s assertion that it’s almost ready. Speaking to a packed auditorium during a panel featuring people involved in building its infrastructure at the Payments Canada Summit Wednesday afternoon, Deloitte senior partner Todd Roberts tried to assure attendees. “This program has never, ever, ever been in a better space than it’s in right now,” he said. Kinoshita said skepticism is understandable, but she expects it to dissipate once the system is ready for testing. “This is going to be the biggest transformation this country has seen from a payments perspective in a very long time, if ever,” she said.