According to Payments Canada — the organization charged with underpinning the Canadian financial system and economy by owning and operating Canada’s payment infrastructure — the value of payments cleared and settled in Canada in 2015 was nearly $50 trillion, or $197 billion per business day. Considering that works out to $3 million in electronic payments made every second, it’s safe to say that the future of payments has arrived in Canada.

Putting the spotlight on payments modernization

Led by legacy banks such as TD and a host of innovative FinTech start-ups, banking and financial services in Canada are evolving. Canada’s modern payments system is fast, flexible and secure, while also promoting innovation, improving the consumer experience, and strengthening Canada’s competitive position globally.

“The future of banking is changing dramatically and is being led by the payments sector, which we believe will be a major differentiator going forward in terms of competing in a digital economy,” says Christine Hunter, the VP of Payments at TD Bank. “In a lot of ways, it’s helping banks think about the future and ensuring we invest in our foundations and infrastructure.”

The mass adoption of new technologies has set the expectation for commerce to be available anywhere, anytime. These innovative technologies are challenging traditional payments systems, while new global players are entering the payments arena. Businesses and consumers are demanding increasingly flexible, convenient, and simple payment experiences with the same level of security and privacy that they’ve always depended on. Around the world, investments in payments infrastructure are being made to drive economic growth and efficiency.

“TD is viewing the payment area with clear vision, as it’s a very dynamic space,” says Hunter. “We’re looking internally at simplifying our own technology and processes, while keeping pace with the payments industry, staying ahead of the trends, and partnering with the right firms to deliver great value to our customers.”

TD leads the pack in payment innovations

TD is working tirelessly to bring consumers a better and more seamless payment experience by focusing on the needs of a modern payment system. It’s not just about the underlying system, though — it’s about creating potential and laying the framework for innovation. To that end, TD recently established the Enterprise Payments Council, which focuses on payments oversight, reporting, and education across the bank in order to foster potential and encourage innovation.

“Keeping up with the rapid changes across all payment sectors is not something you do overnight,” says Hunter. “It can only be achieved through continued focus and agility. That’s why we’re continually looking at the landscape and adjusting our path going forward, while only deploying change in a calculated way.”

This change is geared toward providing payment options that are faster and easier, while also being data-rich and transparent. TD believes payment systems should be a platform for innovation that meets the specific needs of Canadian consumers, such as cross-border convenience, while also being safe, private, and secure.
“Security is paramount for TD,” says Hunter. “It needs to be as strong as or stronger than ever, so we invest heavily in our infrastructure, knowing that without adequate security, the entire ecosystem fails.”

What’s next for the payments industry?

A recent survey from Payments Canada revealed that a full 50 percent of Canadians are ready to completely ditch cash, while two thirds are ready to say goodbye to personal cheques. End user needs and expectations are evolving, and payment experiences need to keep up. As such, investments are being made in payments infrastructure to support data-rich payments that make funds available in less than a minute. With Canadians having already embraced near real time options such as Interac e-Transfer, it’s an area in which Hunter feels considerable innovations are still to come.

“On the near-term horizon, you can expect to see some enhancements from TD Bank with respect to Interac e-Transfer, whereby you’ll be able to request money if you’re a small business,” says Hunter. “This promises to be a very helpful product for businesses that want to make it easy for customers to pay invoices electronically.”

TD is also part of an innovative partnership between the major Canadian banks and SecureKey, a leading identity and authentication provider that simplifies consumer access to online services and applications. The consortium of banks recently committed $27 million to develop a new service providing verified credentials for online e-commerce. While ensuring that safety, security and privacy remain paramount, this service will provide consumers with the option of leveraging the customer information held by the bank in proving their financial bona fides to people and companies with which they are doing business.

“At this point, the sky is the limit for this new and emerging space,” says Hunter. “One potential application is when a customer wants to rent an apartment. Not only would this allow for their monthly rent to be paid seamlessly, it would enable the landlord to easily verify the identity and creditworthiness of potential tenants.”

It might also be said that the sky is the limit for the entire payments sector in Canada. While branch visits and ATM transactions continue to decline across the country, innovative electronic payment options are multiplying. Led by trailblazers like TD Bank, instant and always on electronic payment transactions and infrastructure are becoming the new normal.

“This is a very dynamic space where the opportunities to make life easier for our customers are endless,” says Hunter. “I’m excited about the potential to move faster, be even more innovative, and provide Canadians with a truly seamless payment experience.”