Though real-time payments (RTP) aren’t yet available in Canada, North America’s commercial northern lights want all the benefits of real-time rails, one might say, in real time.
In the study “Accelerating The Time To Realized Revenue Playbook: The Real-Time Payments Edition,” a PYMNTS and Mastercard collaboration, we surveyed 400 executives from the manufacturing, healthcare and transportation/logistics/shipping verticals in the U.S. and Canada, finding a strong desire to get this capability north of the border.
It’s understandable that Canadian business is watching RTP with intense interest. As the study states, “Canadian firms can look to their U.S. neighbors to learn about the benefits they have reaped from adopting real-time payments,” with 41% of U.S. firms using RTP pointing to better operational elasticity, instant funds availability and finer remittance detail as being among prime benefits of moving money and messaging instantly, and as a secure package.
With the Bank of Canada’s Real Time Rail (RTR) initiative a year away, expected to be live by mid 2023 — which may or may not happen on schedule — many Canadian businesses are feeling like they’re transacting in slow-motion. Toronto’s a 55-minute flight from Manhattan, after all. It’s no stretch to say Canadian business wants its real-time now.
Per the study, “37% of all large- and mid-market Canadian firms are ‘very’ or ‘extremely’ interested in using real-time payments, and 59% express at least some interest. Just 6% of Canadian firms have no interest in real-time payments, underscoring how universal the demand for real-time payments is in the Canadian market.”
Our research found that U.S. businesses using RTP “are more than twice as likely to have seen real-world improvements in both their data security and cash flow management capabilities as Canadian firms say they believe real-time payments can improve these areas.”
It’s not going unnoticed in Canada, where having 24/7 access to RTP rails is resonating with 35% of Canadian firms surveyed, citing it as “an expected benefit of adopting these payments.”
Proponents say the irrevocable nature of real-time payments is a strength, but that finality isn’t assuring to Canadian businesses that aren’t fans of RTP, like their U.S. counterparts.
The study states found that more than half (55%) of Canadian firms uninterested in real-time payments are concerned primarily with fraud, as are 24% of all businesses surveyed.
Ironically, we also found that only 16% of those using RTP say fraud is a major issue.